McNugget Reboot Targets Different Crowd

The Atlantic: “The reboot of the Chicken McNugget is a mechanism by which McDonald’s is continuing its effort to present itself as a ‘modern progressive burger company.’ Last year, the company announced the phasing out of chicken raised with antibiotics used in human medicine, said it would stop using palm oil linked to deforestation, and pledged to shift to cage-free eggs.”

“The revamped version of the Happy Meal staple will soon be free of artificial preservatives, instead containing lemon-juice solids and rice starch.”

“Through its rebranding process, McDonald’s has still managed to sell plenty of Chicken McNuggets, particularly to lower- and middle-income consumers who are concerned more about price point than about the impeachability of the company’s food sourcing. Instead, this tentative new McNugget is an effort to reach a different crowd. ‘There’s a smaller amount of consumers who don’t eat them, but might be willing to if they raised the bar on quality,’ said Darren Tristano, the executive vice president of the market-research firm Technomic.”

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There’s Nothing ‘Illegal’ About Retail Subscriptions

Bloomberg: “Adore Me is among a group of buzzy Internet retailers accused of sometimes placing customers into unwanted and hard-to-cancel retail subscriptions. Several of these companies have been hit with lawsuits alleging unfair business practices, including JustFab (apparel), Blue Apron (food delivery), and Birchbox (beauty samples). Adore Me is currently facing a lawsuit from a disgruntled subscriber.”

“There’s nothing illegal about retail subscriptions, of course, and many businesses with automatic renewals make the billing process crystal clear. Some services are transparent in their mission and describe themselves primarily as pay-each-month subscriptions, like razor seller Dollar Shave Club.”

“But weak and misleading disclosures are pervasive among subscription e-commerce businesses, says Francisca Allen, the deputy district attorney of California’s Santa Clara County. Allen pursued the JustFab and Stamps.com settlements, both of which included reforms to the companies’ websites. Consumers are losing tens or even hundreds of millions per year on unwanted automatic-renewal subscriptions, she says, and there’s not enough regulatory muscle to monitor and stop unfair practices.”

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Late & Great: Philip Kives

The Guardian: “The late Philip Kives is “hailed as having invented the infomercial, producing a live, five-minute TV ad for a Teflon non-stick frying pan … the format stood him in good stead when he diversified from homeware and into music in 1966 … At the time, the idea of a multi-artist compilation was a rarity, because record companies were not keen to have their artists on the same LP as artists signed to competitors.”

Few were the households in the 1970s that didn’t have some sort of K-tel release propped up beside the stereo in a manner that makes the supposed ubiquity of an act like Adele today pale in comparison … For Kives … music was just another product like the Patty Stacker, the Bottle Cutter, the Veg-o-Matic food cutter and the Miracle Brush … While artists might bristle at the idea of being sold in the same way as a tool for chopping vegetables or cleaning suede, for Kives it was still the boardwalk and he was gripped by the thrill of sell, sell, sell.”

“Today, marketing executives like to regard themselves as super-sophisticated, guiding what they do with endless data, market research and analysis; but they are still working on many of the same principles that Kives perfected half a century ago. Except he was arguably much closer to the audience, understood them better and respected them more.”

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Hardware Gone Soft: Apple Integrates the ‘Experience’

Quartz: “Apple’s big surprise in its quarterly numbers isn’t the end of 13 years of go-go growth but the emergence of Services as a very large revenue category … Services grew 10% in 2015, 15% in the December quarter, and now 20% in the last three months.” Consequently, “many on Wall Street and elsewhere have started to ask if Apple is going to treat Services as a separate business with its own profit & loss statement.”

“For Apple, this would be a momentous cultural shift away from its praised functional structure—one Tim Cook sees as fostering effective collaboration across groups such as operating system software, built-in apps, hardware, developer relations, and retail operations. The idea is for everyone to work together on the customer’s experience, as opposed to concentrating on an isolated goal: hardware revenue, App Store profits, or retail numbers.”

Apple “wins or loses through the experience it delivers to its customers. Once upon a time, revenue came mostly from its personal computers, small, medium, and large. Software and Services had one and only one purpose: pushing up personal computers’ volumes and margins. Hardware, software, and Services coalesced into what we now call an ecosystem. Over time, as a result of the size of the installed base of Apple devices, Services became substantial, the number two revenue category.”

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In What Universe Is Salad a Technology?

Slate: “Walk past a Sweetgreen during lunchtime, and you’re bound to find a line of famished office workers snaking out the front door for a shredded-kale caesar salad or quinoa bowl. But when the Los Angeles-based farm-to-table salad chain launched a new app in January, it curiously referred to itself as a business that had developers—not produce or salad dressing—at its core. ‘We’ve always acted more like a tech company than a food one,’ read its press release.”

“In recent years, Sweetgreen has grown an in-house tech team and created an algorithm to make ordering more efficient … These days, businesses across every sector—from fashion to finance—are claiming the tech label. The recasting is seductive: It’s simply a lot cooler to be about the internet of things than to be about just things.”

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The Future is Platforms, Not Products

Quartz: “A trait shared by the fastest growing and most disruptive companies in history—Google, Amazon, Uber, AirBnb, and eBay—is that they aren’t focused on selling products, they are building platforms … A platform isn’t a new concept, it is simply a way of building something that is open, inclusive, and has a strategic focus.”

“Think of the difference between a roadside store and a shopping center. The mall has many advantages in size and scale and every store benefits from the marketing and promotion done by others. They share infrastructure and costs. The mall owner could have tried to have it all by building one big store, but it would have missed out on the opportunities to collect rent from everyone and benefit from the diverse crowds that the tenants attract.”

“What has changed is that technology has reduced the need to own infrastructure and assets and made it significantly cheaper to build and scale digital platforms … Companies such as Walmart, Nike, John Deere, and GE are working towards building platforms in their industries. John Deere, for example wants to be a hub for agricultural products … Building platforms requires a vision, but does not require predicting the future. What you need is to understand the opportunity to build the mall instead of the store and be flexible in how you get there.”

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The Storefront Index

City Observatory: “The Storefront Index “measures the number and concentration of customer-facing businesses in the nation’s large metropolitan areas … by mapping the locations of hundreds of thousands of everyday businesses … and then identifying significant clusters of these businesses—places where each storefront business is no more than 100 meters from the next storefront.”

“The result is a series of maps, available for the nation’s 51 largest metropolitan areas, that show the location, size, and intensity of neighborhood business clusters down to the street level … The Storefront Index helps illuminate the differences in the vibrancy of the urban core in different metropolitan areas.”

For example: “In Portland, there are about 1,700 storefront businesses in a three-mile circle—with substantial concentrations downtown, and in the close-in residential neighborhoods nearby … New York and San Francisco have the densest concentrations of storefront businesses in their urban cores … Maps of the Storefront Index for the nation’s 51 largest metropolitan areas are available online here. You can drill down to specific neighborhoods to examine the pattern of commercial clustering at the street level.”

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The De-Malling of America

The Wall Street Journal: “Retailers from Gap Inc. to Abercrombie & Fitch Inc. are abandoning a decades-old strategy of growing sales by blanketing cities with stores as consumers do more of their shopping online and less at the mall. The shifting shopping habits have prompted chains such as Williams-Sonoma Inc. and Macy’s Inc. to close stores in secondary malls to focus on web sales and more upscale shopping centers.”

However: “Mall owners disagree about whether the Internet is their main problem. They point to demographic changes that redirected population and income growth away from malls built years ago, along with a real estate glut that has left the U.S. with 24 square feet of retail space per person, compared with 15 for Canada, 10 for Australia and 5 for the U.K., according to the International Council of Shopping Centers.”

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Innovation: The Green Eggs & Ham Theory

Pacific Standard: “‘Constraints may turn out to be liberating,’ Rider University psychologist Catrinel Haught-Tromp writes in the journal Psychology of Aesthetics, Creativity and the Arts. In two studies, she found students produced more creative writing samples when they were forced to abide by certain arbitrary rules.”

“What’s more, students continued to work at that higher level of imagination even after the restrictions were lifted. Once the challenge of working around certain restrictions has sparked one’s creativity, it appears to stay stimulated, at least for a time.”

“Haught-Tromp refers to this as the Green Eggs and Ham hypothesis .. Writer/illustrator Theodore Geisel was given a challenge by his publisher: Write a book small children will love using no more than 50 words (which could be repeated as often as needed). The result became a classic.”

“Why is this approach effective? Working with constraints ‘allows a deeper exploration of fewer alternatives,’ Haught-Tromp explains. They ‘limit the overwhelming number of available choices to a manageable subset,’ allowing us to ‘explore less familiar paths, to diverge in previously unknown directions.’

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Designing Virtual Assistants: Poetry in Automation

The Washington Post: “As tech behemoths and a wave of start-ups double down on virtual assistants that can chat with human beings, writing for AI is becoming a hot job in Silicon Valley. Behind Apple’s Siri, Amazon’s Alexa and Microsoft’s Cortana are not just software engineers. Increasingly, there are poets, comedians, fiction writers, and other artistic types charged with engineering the personalities for a fast-growing crop of artificial intelligence tools.”

“As in fiction, the AI writers for virtual assistants dream up a life story for their bots. Writers for medical and productivity apps make character decisions such as whether bots should be workaholics, eager beavers or self-effacing … Even mundane tasks demand creative effort, as writers try to build personality quirks into the most rote activities … many developers of artificial intelligence make a point of adding a weird element to their avatar designs — such as an asymetrical face or an odd joke — something that signals that the virtual assistant isn’t human and doesn’t aspire to be … At the same time, the imperfections are meant to be endearing. A robot without such flaws could seem cold and alienating.”

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