business news in context, analysis with attitude

(Your Views is broken into two sections this morning. This one is about business issues, and the second section is about other stuff.)

The other day I took note of consultant Don Peppers’ recommendation that retailers could make a profit by charging admission (which is what club stores do), and suggested that “Peppers really is using hyperbole to make a bigger point - that price and accessibility simply are not differentiators anymore, because anybody can underprice you, and anybody can be more accessible. Enlightened marketers instead have to focus on the value of the product, the values behind the product, and the ultimate utility of the product in a person’s life.”

MNB user Mike Franklin wrote:

Your thoughts were right on…anybody can copy a company’s products…price…etc…it’s difficult to copy a company’s personality…and that’s what differentiation is all about. There are only three ways to compete…lowest price, differentiate, or copy…only differentiation gives long-term benefits.


Another MNB user wrote:

I had to think about it for a few minutes and decided Don Peppers was right.  If you want your business to be a few steps ahead of the competition, it ought to be special enough that you could charge admission.  Not saying you would charge, you could just call it your competitive edge.   Costco's membership fee is really an admission charge and it works for them.

We had some discussion recently about statistics showing that four out of 10 meals in the home are being prepared by men, which sort of surprised me.

One MNB user wrote:

I'm not surprised by the percentage of men cooking dinner, given the way the recession hit men.

My husband cooks dinner most nights and has for several years. One big difference between our styles is that he researches every dish and develops his own version after reading a number of recipes (books and online sources). He uses what he considers the best step from each recipe and OMG - have we been eating well. Only problem: he never writes it down, so we can never have the same dish twice.

Another MNB user chimed in:

I'm not at all surprised by this statistic.  Almost all of my male coworkers share the dinner preparing responsibilities with their wives.  My husband cooks dinner more than 50% of the time (who gets home first cooks dinner . . . . and, frankly, he is a better cook than me . . . . he gets home first a lot!).  My son cooks a heck of a lot more often than my daughter.  Not to mention the fact that the statistic depends on how the question was asked.  I don't know any man who can tell me he never participates in meal preparation.  Are you saying you don't? Not even on the grill?

No, I do. When I’m in town, I do 90 percent of the cooking. But the four-of-10 statistic surprised me.

I love it when I get emails like this one:

I’ve yet to have a customer experience so bad and so good in the same night, that requires me to write and tell you about it. Well, that all changed last night.

My fiancé and I are 3 months from being married. This weekend we will be sending out our invitations and with them the registry cards of the retailers who we’ve selected to have our guests spend their money at.

First, allow me to explain our experience with Target’s Club Wedd program. Upon registering a few months back we were informed that we needed to order our registry inserts from a 1-800 hotline number. Mind you, no other details were given other than just simply call them and they will send you as many as you need. Last night rolls around (perhaps we waited a little late but we were not told timelines existed) and I call Target’s hotline number and get a gentleman who claims to be the “Supervisor” for that shift. I go through the rigorous process of even getting him to pull up my account and tell him I need 250 inserts. He proceeds to tell me that the maximum number of inserts I can place in one order is 180 and that to get the additional 70, I have to call the number back, go through the process again, and they will place another order. Upon calling back, I get a female who also claims to be a “Supervisor” who tells me that what I’m requesting can’t be done so she forwards me to her “Supervisor” which ironically is the first gentleman I talked to. He proceeds to tell me that my request for 250 inserts is going to take Senior Supervisor approval from the Minneapolis office and to please CALL BACK tomorrow morning between the hours of 7am-5pm. An added bonus? They have a two week lead time to send out these inserts, which is not mentioned anywhere with any of their registry info.

Flash forward to Sears about an hour later:

My fiancé and I discovered that the registry inserts given to us from Sears, which come with convenient discount coupons on the back, were expired. Now, unlike Target, I’m actually able to go to a Sears store to resolve this problem and hope to get more inserts in person with no two week lead time or maximum number per order. However, our night was continuing to slide downhill when we were informed by the Manager on Duty that Sears had recognized the problem with the expiring coupons and were currently ordering more that had non-expiring coupons. Instead of suggesting I come back tomorrow, like Target did, to resolve my issue, the following happened. The manager took down all of our information, how many inserts we needed, and was going to call every Sears in the area to see if they had any in-stock that were either the non-expiring or will not expire by our wedding date. THEN, they were going to have them shipped to us and we can expect them by Friday.

Two wedding registries, two different retailers, one customer service experience that will lead to continued customers and one that will not.

I plan on calling Target back today to plead that they override their “system generated” response to not sending more than 180 inserts and request they overnight them to me to redeem their lack of customer service. If they will not, I will kindly inform them that the 150+ items we are registered for that amounts to several thousand dollars in merchandise will be removed and our registry closed.

I know this was very long winded, please feel free to edit for length. I just felt compelled to share something that is talked about daily on the MNB and something I feel you find very important to the success of any retailer and something I find important not only personally but professionally

Great object lesson. Thanks for sharing.

Regarding a Parisian bus stop designed to smell like baked potatoes (it is an ad for McCain), one MNB user wrote:

I hope this is an 'opt' in feature for smell-o a strong smell of coffee give me the dry started with the pregnancy of my 2nd child, but my body never recovered.  I sometimes am forced to avoid the coffee aisle in the grocery store if the odor is strong. It also forced me to 'other' bookstores, rather than B & N because of the Starbucks in the bookstore.  Not all B&N have the strong Starbucks coffee smell, or at all times, but I know as soon as I walk in if I will be able to stay or need to leave.

I know what you mean, because I have the same reaction when I’m in the same room with egg salad.

Regarding my recent observation that the use of internet sensation Kate Upton on the cover of the Sports Illustrated swimsuit issue demonstrates yet again the power of social media, one MNB user wrote:

So true. Social media has become a gateway to self-made people everywhere. It amazes me that people can do anything from modeling to singing to asking for $1MM and have success (that last one blew my mind).

I was at a pizzeria with my wife last night and noticed a story come across the TV. It was referencing Kate Upton and how she was the niece of a prominent politician. I thought your story was interesting because as effective as social media is in jumpstarting her career, she has also caused a media firestorm for her uncle. It amazes me how many ripples one photo shoot tweet/status update can make due to how connected we are all.

I never understood why having a niece in the swimsuit issue should be a problem for a Congressman. Just goes to show you that some people will try to make a political issue out of anything and everything.

We’ve had some discussion lately about why young people often do not want a career in grocery retailing. One MNB user chimed in:

I work for an independent grocer that prides himself in giving .10 and .25 raises. I am always amazed how we treat our front line workers. They are the first and last person that see our customers . I am always fighting to change this. When do you ever hear of a high school graduate say I am going into the "grocery industry". You just don't. The industry demands great customer service, yet the people that see our customers the most get paid minimum wage.

Another MNB user wrote:

The pay scale is not the only problem for companies that try to trying to recruit workers. In eight and a half years with one company I have worked at three different grocery stores in the chain. In that time I only know of one person who has gone from a part time position to a full time position. That person is a cake decorator. I am in my sixties so I don't expect much more than a dead end job. If I was in my twenties I would take a pay cut to leave this organization.

I have worked with a number of people who I felt would make wonderful managers, much better than most of the managers I have actually had. Come January the hours of new employees get cut drastically. The first year they might suck it up. The second year one of two things happens: either they leave or they go from trying to make a contribution to putting in their time until they figure out what they want to do. This is a great way to decapitate a company.

When employees are treated shabbily the ones you would like to keep are the ones that tend to leave. The ones who stay are the ones you would just as soon leave.

Regarding the growth of Chipotle, MNB user Mark Raddant wrote:

The first time I went to a Chipotle, I thought it was a local chain.  It was located in a sort of “hip” area and had the correct arty/funky vibe.  Later, others sprang up and I thought the chain, having some success was expanding, but still local, and they all still had the same feel to them. Later, I discovered that some friends of my Iowa farm girl wife  had gone to work raising cattle and hogs for Chipotle because Chipotle wanted their products raised the way Carl and Melody wanted to raise them, hormone free, and walking around in the fresh air.

It is great to see the success has continued.  When my family is crunched for time, Chipotle is our go-to quick, healthy and VERY filling dinner.  It doesn’t hurt that the Barbacoa goes well with a glass of red wine, either.  You can’t say that about any other “fast” food I can think of.

I’m with you. Chipotle is a great example of a fast food chain that reaches higher than the lowest common denominator...

On another subject, from another MNB user:

I'd like to comment on the idea of bringing "sustainable" foods to food deserts.

The word sustainable is being bantered about quite a bit by food conglomerates who want to spin their grocery stores into something we all think is good for the world.  On another level the term applies to the ability to farm using methods that care for the land rather than depleting its resources.  I can't think of any grocery stores that can truly lay claim to this definition.

While it is an excellent idea to provide good food choices to areas that have not had the availability of such choices, it seems like there are alternatives that would provide for a greater good for all.  What about providing garden sites, education, seeds, tools to people living in "deserts" so that they can learn to develop truly sustainable food resources for themselves and others?  This method not only provides good food, it has the added benefits of a healthy form of exercise, neighborhoods working together, satisfaction of seeing hard work produce great results in the form of really nutritious and sustainable food.

And, another MNB user wanted to contribute to our discussion from last week about the importance of getting buy-in to a company’s mission statement:

Regarding the debate over a company’s mission statement and whether it makes sense for people to literally sign on to a company’s mission, what is being missed is not whether mission statements are a good thing or a bad thing, but whether a company’s leadership truly believes in their mission.  If the leadership lives the brand, not just in words and deeds, but in their very character, then the mission statement can be the powerful rallying point that Steve Stoute espouses.

If the company does not live their mission every day, then the statement becomes the “kind of messianic, delusional crap” that Mr. Paschel described in his email last week.  I’ve seen both types of organizations and the difference in morale and effectiveness (and stock appreciation) is like night and day.  Leadership that lives the mission will build an enthusiastic group who want to be on the team.  Those that only pay lip service will be surrounded by ineffective “yes” men looking for an easy paycheck.

I can also back up that Jim Koch does truly live the brand.  What you see on TV is the same beer enthusiast that runs the company.

Good to hear. Like I said last week, he’s one of those guys who I would really like to meet - and have a beer with - someday.

And finally, regarding the hiring of Jim Donald to run the Extended Stays hotel chain, one MNB user wrote:

Jim is a hard working person with a plan and takes on challenges better than anyone  I know. Whoever hired Jim, is brilliant.

And MNB user Paul Higham wrote:

Jim Donald is one of the ablest executives I've worked with.  I think that this appointment bodes well for Extended Stay Hotels.  Keep your eye in this company because he'll lead them to great performance.

No argument here.
KC's View: