Dad Shoes: Hot But Not Cool

Business Insider: “The Air Monarch is by all accounts a boring shoe, meant neither to inspire nor offend. This makes it stand out in terms of the other shoes on the usual lists of bestsellers … But the shoe’s mundane design could be precisely what attracts both older customers seeking something comfortable and acceptable, as well as some younger consumers looking to subvert trend-obsessed fashion attitudes.”

“Adidas’ Stan Smiths, similarly, have been flying off the shelves for years now. The shoe is distinctive enough that designers, models, and moguls want to be seen with them on their feet, but they’re not so outlandish and colorful that the average person would be wary of buying and wearing them. And indeed they do buy them, as the shoe has sold an estimated 40 million pairs since 1973.”

“Then take NBA MVP Steph Curry’s partnership with Under Armour. The ‘Che'” Curry Two Low was torn apart on Twitter after its debut because of its ‘boring’ appearance. But the shoes ended up performing very well, selling out in two days even though the shoes are not on limited offer like many of the collaborations that have star power behind them … The flashier shoes are designed to create a halo effect, enshrining the brands in a holy glow that makes it feel trendy and cool … but it’s the consistent and reliable success of dad-approved shoes like the Air Monarch, Stan Smith, and Chef Curry Two Low that are helping to make these brands real money.”

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Prices & The Dark Side of Digital Commerce

The Wall Street Journal: “In Virtual Competition, Ariel Ezrachi and Maurice E. Stucke, two legal scholars, make a convincing argument that there can be a darker side to the growth of digital commerce. The replacement of the invisible hand of competition by the digitized hand of internet commerce can give rise to anticompetitive behavior that the competition authorities are ill equipped to deal with. The authors observe that it is possible for digital sellers to collude and fix prices just as we have seen in the non-digital environment.”

“Longstanding laws, it is true, can prevent online sellers from giving specific directions to join cartels and fix prices. But the situation gets murky when the computer algorithms of sellers are designed to learn what others are charging and to change prices in response. Will computers learn to collude? Can the use of artificial intelligence allow computer self-learning to produce the same results as tacit collusion and actually raise prices?”

“Messrs. Ezrachi and Stucke also examine how online sellers, by using technology to gather far more detailed information about their potential customers than was previously possible, can engage in ‘almost perfect’ behavioral price discrimination … suggesting that internet sellers can charge different prices to different consumers—the price discrimination determined by an estimate of how much the customer is willing to pay. Two-thirds of online shoppers, for example, abandon their carts after initial click-through. Sellers might then determine that such buyers are more price sensitive and can be induced to finalize their purchases if offered discounts or other inducements.”

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Is Slower Better? The Joy of Waiting

Dan Ariely: “Many businesses are trying to deliver their wares more quickly, but it isn’t always a good idea. When we want something, we usually think that faster is better and now is ideal … the retailer is basically forcing everyone to pay for faster shipping (the list price of your goods will necessarily include the cost of faster shipping) and forgo the joy of waiting. Neither is ideal, especially if your purchase happens to be an exciting treat rather than a dreary necessity.”

“Many online retailers would do better to help their consumers savor the anticipation rather than deliver so quickly that we lose some of the fun of our purchase.”

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The Art of Retail: A New Media Canvas

The New York Times: “Art is playing a larger role in stores, as retailers do whatever they can to make shopping in person fun, inspiring and worth the time.” Peter Marino, a retail architect, comments: “Shopping can be stressful but the art uplifts and makes you smile. And when people go back to the hotel, it’s the art they discuss and remember.”

“The focus on art is part of the change in retail and the continuing move to digital transactions. ‘The product isn’t enough now, it’s the experience,’ said Rob Ronen, an owner of Material Good, a watch and jewelry store in SoHo … ‘Because if the shop is just about the product people go online’ … The jeweler Stephen Webster opened a store in London’s Mayfair neighborhood in May that has opposite the door a taxidermied swan in full flight, with wings outstretched, greeting his visitors.” He explains: “People ask questions about the swan, and it focuses people more on what is in store.”

“Art historically has a strong track record drawing people into stores. Take the Paris department store Bon Marché, which became the fashionable place to be in 1875 when it opened an art gallery … Carla Sozzani, founder of Milan’s 10 Corso Como concept store, which has blended fashion, design and books with art for 25 years, believes that displaying art slows the way people shop.” She comments: “Even the way people purchase changes because they think more about what they are buying so they buy things they really want, which creates a faithful clientele.”

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The Landweb: Saks Deconstructs & Reinvents

The New York Times: At Saks Fifth Avenue Downtown … product displays are inspired by websites that encourage shoppers to browse. Where traditional department stores keep handbags separate from clothing … an edited range of goods is organized by designer label, with handbags, ready-to-wear and jewelry commingling on a circular path intended to inspire surprise finds.

Saks President Marc Metrick comments: “We wanted to de-compartmentalize the department store. That’s not how she shops anymore … we lay things down flat on tables, just like you’d see on a website.”

Saks also “has rolled out applications from the retail technology company Salesfloor that enable online visitors to live-chat with a sales associate at a nearby physical store. After browsing product suggestions online, shoppers can make an appointment to meet their sales associates in person, to continue shopping. And even after the in-person visit, the shopper can follow up with the very same sales associate again, online.”

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Toblerone’s ‘Treasonous’ Triangle

The New York Times: “The maker of Toblerone, the Swiss chocolate bar, has reconfigured the unique appearance of two of its milk-chocolate versions, with narrower triangles and a larger gap between peaks … the changes to the smaller one … were so pronounced that Toblerone’s Facebook page was filled with outrage from aggrieved consumers, even though only a relatively small number were likely to be affected.”

“The change, which was announced on the Toblerone Facebook page last month, is in keeping with a common strategy for companies trying to avoid price increases by reducing the contents of a product without changing the packaging. Most consumers are unaware of the changes because the product usually looks and is priced the same — there is simply less of it — but the newer, gappier Toblerone bar felt treasonous to the brand’s loyal consumers.”

“The triangular milk chocolate bar, sold in a yellow package with red letters, has been around since 1908. The founder, Theodor Tobler, combined his family name with ‘torrone,’ the Italian word for nougat, and patented his recipe of chocolate mixed with milk and honey … Mondelez International noted that while the overall look of the bar is different, the recipe remains the same and the chocolate is still made in Switzerland.”

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Halo Top: Lo-Cal ‘Wonder’ Dessert

Bloomberg Businessweek: “If you’re a committed ice cream adherent, you may have already heard of Halo Top, the wonder dessert with as many calories per pint (240 to 280; $5.99) as a single half-cup serving of most ice creams. It also has just 5 grams of sugar, as much protein as a 3-ounce serving of beef (24g), and only 8g of fat. Compared with a pint of Chunky Monkey (1,200 calories, 112g sugar, 16g protein, 72g fat), or even Breyer’s fat-free (360 calories, 52g sugar, 8g protein), Halo Top looks like a flat-out miracle.”

“Like many great inventions, Halo Top was the result of trial and error. In traditional ice cream, not only does sugar provide flavor, but it also lowers the melting point so the frozen product doesn’t get rock hard. Fat, meanwhile, helps create a scoopable consistency. Remove both of those components, and you’re left with what amounts to flavored ice.” Halo Top founder Justin Woolverton “landed on a no-calorie sugar alcohol called erythritol (not the kind of alcohol that would get you drunk) along with the all-natural, zero-calorie sweetener Stevia for sweetness, milk protein to make up for the lost fat, plant fiber to help with meltability, and extra egg white for overall consistency.”

Halo Top “appeals to two seemingly opposed groups: those seeking low-calorie ice cream alternatives, and others seduced by a dessert that can help them bulk up … Halo Top’s success has enabled it to experiment in an unexpected way: with higher-calorie versions. In October the company introduced 10 flavors, including red velvet and peanut butter cup … At 360 calories a pint, it’s still a sweet deal.”

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There Goes the Neighborhood (Grocery)

The New York Times: “The neighborhood grocery store — with its dim and narrow aisles full of provisions precariously stacked from floor to ceiling and the cashier who greets you and your dog by name — is a critical piece of a New York life … It can keep a neighborhood manageable for new parents who need diapers now or seniors who cannot carry their groceries a long way … Even if the corner market seems sad and shabby and its aisles are barely wide enough to accommodate a single mini-shopping cart, you can dash in for a carton of milk or a loaf of bread.”

“Some have succumbed to high rent, narrow profit margins and increased competition from upscale supermarkets, online grocers and drugstore chains that have expanded their wares to include grocery items … For two decades, drugstores like CVS and Duane Reade (a.k.a. Walgreens) have been steadily taking over retail space that once housed grocery stores.” However: “Few drugstores, or for that matter, supermarkets, are likely to hold your keys for your brother, or inform you that your husband was just in and already bought dinner. That’s the time-honored business of a neighborhood market. Chances are, you’ve watched the owner’s children grow up in the photos proudly taped to the register.”

“In a city of eight million, the shops on the corner are the ones that make New York feel like a small town. Without them, a neighborhood can feel less like home.” Tommy Berger, a Brooklyn resident comments: “These are unique relationships … with these shopkeepers. I count on them being there in sunshine and rain. And if they go away it disrupts my whole worldview.”

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Trader Joe’s: A Toxic Culture of Coercion?

The New York Times: “A number of workers, known at Trader Joe’s as ‘crew members,’ complain of harsh and arbitrary treatment at the hands of managers, of chronic safety lapses and of an atmosphere of surveillance. Above all, some employees say they are pressured to appear happy with customers and co-workers, even when that appearance is starkly at odds with what is happening at the store.”

“Tensions have been heightened, according to several employees, by the pressure to remain upbeat and create a ‘Wow customer experience,’ which is defined in the company handbook as ‘the feelings a customer gets about our delight that they are shopping with us’… with more than 400 stores generating over $10 billion in sales, according to estimates, the company culture appears to have evolved from an aspiration that could be nurtured organically to a tool that can be used to enforce discipline and stifle criticism.”

Gammy Alvarez, an employee at a Trader Joe’s store in Manhattan, comments: “The environment in this job is toxic, but they’re trying to create this whole false idea that everything is cheery and bubbly. I think they want us to be not real people.”

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CEO Rides The Tide at Procter & Gamble

The Wall Street Journal: Procter & Gamble CEO David Taylor “eschews talk of reinvention. He aims to keep P&G on top by playing to its historic strengths … Mr. Taylor said he is confident that P&G’s best prospects remain rooted in fundamentals. That means selling to the masses by way of big retailers on the strength of meticulously collected consumer research, a massive research-and-development operation and the world’s biggest advertising budget. P&G, he says, needs to learn to do these things faster and more effectively.”

“Executives say they are seeing results. Take the company’s new environmentally friendly laundry soap, Tide Purclean. It was conceived and brought to market in nine months … A big time saver was a new process in which leaders from different areas work concurrently. So instead of completing the chemistry of the product and handing off to the team that makes the bottles, those parts of the business work side by side.”

“At one point Mr. Taylor intervened to head off what could have turned into a long deliberation: determining the color of the bottle cap. The team worried a cap the color of Tide’s signature orange would distract from the environmental message. But they wanted to be sure the detergent was still recognizable to customers. Mr. Taylor told the team to go with orange.”

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