Why Did Lego Hinder Product Sales?

The Washington Post: “Business has been so brisk at the world’s most profitable toymaker that Lego last year did something unusual: It began looking for ways to discourage customers from buying its products. The Danish company scaled back its advertising efforts amid a 25 percent rise in annual sales … It simply couldn’t make enough toys to satiate demand in North America, and needed a break while it boosted capacity at its factories and increased its workforce by nearly 25 percent.”

“But executives at Lego are hoping to ramp up production in time for this year’s holiday season … The company is buildings its first factory in China, and is expanding existing plants in Mexico, Hungary and Denmark. Lego also hired 3,500 employees in the first half of the year, increasingly its workforce to 18,500.”

Lego CFO John Goodwin comments: “In the past decade we have seen LEGO sales growth in the double digits year after year. We are of course very excited about this development. [But] the high demand also puts a strain on our factories around the world.”



Zalando: Fashion, Emotion & Ecommerce

The Economist: “One of Europe’s most interesting technology companies sells shoes and threads … Zalando has a Silicon Valley-inspired work environment, holding “f**k-up nights’ to celebrate failure and ‘hack weeks’ to cook up new ideas. It encourages its employees to abandon hierarchy and structure for what it calls ‘radical agility.’ It has a 1,350-strong, and rapidly growing, technology team. Among its other assets are its software, which it built itself, and its user-friendly apps (two-thirds of all traffic goes through mobile phones).”

“Zalando pays close attention to data. It gleans a wealth of numbers from the more-than-5m daily visits to its site, and some brands and retailers of the bricks-and-mortar sort give it access to their stock counts. Both sets of figures help improve the firm’s forecasting of fickle fashion trends, its use of targeted ads and the speed of its responses to shifts in weather patterns or fashion tastes. Through data-mining it can spot the trendsetters among its customers and stock up on what they buy. In future it wants to sell its insights to the rest of the industry.”

“Amazon is pursuing the more price-conscious shopper, whereas Zalando is after a higher-value, more brand-conscious segment. The company believes that for such customers, shopping for clothes, shoes and accessories is an emotional activity; shopping on Amazon is just a transaction.”


Abercrombie & The Demographics of Fashion

Business Insider: “Abercrombie has been trying to save itself for a while now, reinventing its image and as a result becoming totally unrecognizable to the generation of kids who grew up shopping there in the late ’90s and early aughts. The goal was to appeal to older shoppers — 18 to 25 year olds, not teens … In theory, this was a smart idea … this would open the gates to a demographic with more spending money. The move would also help Abercrombie set itself apart from its more teen-friendly sister brand, Hollister … But the brand’s attempt to execute a turnaround is proving to be very difficult.”

Eric Beder of Wunderlich Securities comments: “While the shift to an older customer is a strategy for Abercrombie, we see limited reasons for older customers to shift back to a ‘teen’ brand and, frankly, there are better brands and lifestyles for the 20+ customer to focus on.”

Betty Chen, managing director of Mizuho Securities adds: “In the history of retail, it is very difficult when a brand tries to reposition itself anywhere along the age demographic. You can almost predict failure when you’re going older or younger.”


Choreography, Culture & The Apple Watch

Sydney Skybetter in Forbes: “We’re super attuned to how folks perform in organizations, and I mean “perform” on all registers. How folks speak, who interrupts whom, that nobody seems to like sitting next to Ted – these are all important data points for us … if you’re working on organizational culture, or trying to figure out why certain kinds of conversations feel intractable, or why every meeting that Ted is invited to somehow goes to hell, well, you might need an empathic touch … If you want your team to ideate and move seamlessly together, hire a choreographer.”

“When the Apple Watch was first revealed, I remember thinking … that some nerd in a sub-basement at Apple got paid to choreograph the thing. There was an interface team responsible for coding … the watch’s understanding of human anatomy and gestural metaphor. The watch needed to understand that certain movements indicated particular intentionality, and surveil the wearer to know when, for example, the wrist was lifted more than 12 inches on the Y axis and rotated about 90 degrees, which means it’s probably being looked at.”

“To a growing number of human / computer interface designers, these cues are a choreographic rule game with exponential complexity. How the watch now – and in the future – interacts with a lattice of technologies like your car, your thermostat, your house, your phone, your security system, your refrigerator, etc., are dependencies that need to be composed and standardized. It’s a fundamentally choreographic concern, and, per the ambivalent emergence of the Internet of Things, a real potential clusterfrack.”


The 5-Hour Rule: ‘Learning’ as Lifestyle Choice

Business Insider: “Benjamin Franklin’s five-hour rule reflects the very simple idea that, over time, the smartest and most successful people are the ones who are constant and deliberate learners … Warren Buffett spends five to six hours per day reading five newspapers and500 pages of corporate reports. Bill Gates reads 50 books per year. Mark Zuckerberg reads at least one book every two weeks.”

“For many people, their professional day is measured by how much they get done. As a result, they speed through the day and slow down their improvement rate. The five-hour rule flips the equation by focusing on learning first. To see the implication of this, let’s look at a sales call (note: replace “sales call” with any activity you do repeatedly). Most professionals do a little research before the call, have the call, and then save their notes and move on.”

“Somebody with a learning focus would think through which skill to practice on the call, practice it on the call, and then reflect on the lessons learned … Focusing on learning un-automates our behaviors so we can keep improving them rather than plateauing. Every event is an opportunity to improve. By focusing on learning as a lifestyle, we get so much more done over the long term.”


How Michael Jackson Killed Jingles

The Atlantic: “What killed the jingle? It owes its demise not only to shifts in the advertising business but also changes in the music business, and how the two industries became more entwined than ever … But if there needs to be an individual to blame—or thank—for the death of the jingle, Michael Jackson would be a good candidate. His 1984 Pepsi campaign pioneered the complete melding of pop stardom and product promotion.”

“For one ad, Jackson eschewed singing a traditional jingle and instead adapted his hit single ‘Billie Jean’—an innovation that was his idea—by revising the chorus to ‘You’re the Pepsi generation, guzzle down and taste the thrill of the day, and feel the Pepsi way’ … (Jackson, though, reportedly didn’t even drink Pepsi.)”

“In the realm of licensing old music, again, Michael Jackson had a role. In 1985 he bought the publishing rights to the Beatles’ catalog for $47.5 million. When the band’s song ‘Revolution’ appeared in a 1987 Nike ad, thanks in part to Jackson … the surviving Beatles sued Nike. An undisclosed settlement was reached, but the signal was clear: Not even the most sacrosanct counterculture bands of one’s youth were safe from advertisers.”


Hotels Scramble For Nickels & Dimes

The New York Times: “Unfortunately for travelers, fees and surcharges are a growing moneymaker for hotels and not likely to go away anytime soon. New research from the Jonathan M. Tisch Center for Hospitality and Tourism at New York University indicates that hotels in the United States will tack on $2.55 billion in fees this year — the highest amount since Bjorn Hanson, a professor at the center, began tracking them in 2000.”

“Hotels all over the country are adding fees for … late checkout or early check-in, or a request for a room on a high floor or one with a king-size bed. Some are adding bellhop charges for help with bags or for holding luggage — fees separate from the tips travelers already give the bell staff.” Resort fees “typically cover amenities like pool towels, beach chairs, fitness-center access and a daily newspaper — and guests are required to pay whether or not they actually use any of those things.”

“Although rates and fees at hotels have been rising for a number of years … hotels have been adding perks like upgraded breakfast offerings, free Wi-Fi and renovated bathrooms and lobbies … The problem now, though, is that prices are still rising, and hotels are running out of ways give guests more for their money.”


Quinoa & Kale @ Chick-fil-A

Business Insider: Chick-fil-A is testing a host of new menu items featuring ingredients like quinoa, farro, roasted butternut squash, and chia seeds in hopes of attracting more health-conscious eaters. The chain is testing two grain bowls starting Tuesday: the Harvest Kale & Grain Bowl and the Egg White Grill Grain Bowl.”

“The Harvest Kale bowl features red quinoa, white quinoa, farro, roasted butternut squash, diced apples, and kale topped with goat cheese, feta cheese, tart dried cherries, and roasted nuts. It’s served with a new light balsamic vinaigrette dressing.”

“Chick-fil-A has been getting some complaints after replacing classic menu items like cole slaw and its spicy chicken biscuit with healthier dishes. The company stressed that the new grain bowls would not be replacing any of its traditional menu items, like the original chicken sandwich and waffle fries.”


Walmart: Neighborhood Markets Crush It

Business Insider: “There’s a retail business with 700 stores nationwide that has 22 straight quarters of positive comparable sales growth and 11 straight quarters with comps up 5% or more. It’s not Kroger or Costco, but a division of Walmart that has been quietly crushing the competition — the Neighborhood Market.”

“There are a number of reasons why Neighborhood Market has found success … Grocery now makes up the majority of WalMart’s U.S. segment, and it’s been its best performing one in recent years … Grocery is also one of the few retail categories that rivals like Amazon.com have struggled to penetrate … delivering perishables to your doorstep remains difficult and expensive.”

“Wal-Mart began its life catering to rural customers and has long struggled to penetrate markets … The Neighborhood Market concept, however, has given it the ability to open up in dense cities where real estate may not be suitable for a Supercenter … Wal-Mart’s Neighborhood Markets can also take advantage of food deserts in such environments, neighborhoods where residents have little access to fresh food.”


Dataism: The Next Religion?

Financial Times: “Just as divine authority was legitimised by religious mythologies, and human authority was legitimised by humanist ideologies, so high-tech gurus and Silicon Valley prophets are creating a new universal narrative that legitimises the authority of algorithms and Big Data. This novel creed may be called “Dataism”. In its extreme form, proponents of the Dataist worldview perceive the entire universe as a flow of data, see organisms as little more than biochemical algorithms and believe that humanity’s cosmic vocation is to create an all-encompassing data-processing system — and then merge into it.”

“We are already becoming tiny chips inside a giant system that nobody really understands … But no one needs to understand. All you need to do is answer your emails faster. Just as free-market capitalists believe in the invisible hand of the market, so Dataists believe in the invisible hand of the dataflow … The new motto says: ‘If you experience something — record it. If you record something — upload it. If you upload something — share it’.”

“Dataists further believe that given enough biometric data and computing power, this all-encompassing system could understand humans much better than we understand ourselves … It starts with simple things, like which book to buy and read. How do humanists choose a book? They go to a bookstore, wander between the aisles, flip through one book and read the first few sentences of another, until some gut feeling connects them to a particular tome. Dataists use Amazon.”

“In the end, it’s a simple empirical question. As long as you have greater insight and self-knowledge than the algorithms, your choices will still be superior and you will keep at least some authority in your hands. If the algorithms nevertheless seem poised to take over, it is mainly because most human beings hardly know themselves at all.”