MNB reader Todd Ruberg had some thoughts about my criticisms of the new "365 by Whole Foods" store in Lake Oswego:
I agree with you that the new Lake Oswego 365 format has borrowed ideas from TJ and Costco, but I do think they have wound up with a format that has an appealing combo of features.
Interestingly, I think it has the potential to appeal to BOTH millennials and Baby Boomers. The size of the store is great—not too big, not too small. Plenty of category distribution, but with an edited number of brands/SKU’s per category making it easy to shop, and the potential for inventory cost and return improvements.
Key to me will be the quality of the 365 brand…..if quality holds up, the prices are relatively attractive to competitive formats. Also, their pricing in general ... I can't help suspecting some of it was “grand opening” pricing, but we shall see.
I think your C+ is tough! (God help your PSU students this summer.) I’m more in a B to B+ camp!
I'm actually a pretty easy grader. My philosophy is that everybody starts with an A. You have to earn a B or a C.
Also about the 365 store, from MNB reader Randy Evins:
I love the term “derivative rather than differentiated”. If you don’t mind I plan to use it in further blogs and other…. The original Whole Foods was differentiated, even disruptive but not so much anymore. I was hoping 365 would be that “disruption” that would spark others to see new possibilities but I also felt that their structure and methodologies today are not what they were 20 years ago and it would be difficult to overcome the “this is how we do business” intellectual constraint. It’s so hard these days to constantly push that envelope. To not fall back on what we always do, to do things completely off the charts to get that change to stick. It’s especially rampant in traditional grocery as you’ve so often pointed out. It’ll be fun to watch.
Regarding the passing of longtime Walmart executive Don Soderquist last week, MNB user Bob Anderson wrote:
Mr. Soderquist will surely be missed. He was a great leader and our moral compass. Every time you saw him, he would smile, ask how you were, and shake your hand. Mr. Soderquist and his wife have done so much for the Rogers and Bentonville communities over the years, and touched so many. He will be missed, but not forgotten.
One MNB user had some thoughts about the Ahold-Delhaize deal:
With the exception of Aldi, what European grocer has been successful in the US?
The marriage of these two giants will only bring about higher slotting fees, higher
ad and participation fees with less volume than others in the industry. The days
of having more stores means more volume does not necessarily compute.
Then you have Publix, Kroger, Albertsons with a lot of stores that do it right,
or one of the smaller chains like Market Basket, Wegmans, HEB and Meijer that
have fewer stores but do more volume on a per store basis than most.
From MNB reader Joe Axford:
To me these companies couldn't be more different. Stop and Shop is all union, and uses a rewards card. I can't see them having anything to offer Hannaford, other than economies of scale. Just look at the many people from Hannaford who have gone on to great success at other companies. Stop and Shop I can't think of many.
Hannaford would have been a perfect fit for Kroger, as they certainly aren't buying Shaws. Still trying to figure out how Kroger gets into the Northeast, hopefully sooner than later.
On another subject, one MNB user wrote:
Really appreciate your story on the counterfeiter issue Amazon is facing. I’m ‘all in’ with Amazon as a shopper, but I have noticed of late that scanning product reviews and checking the name of the seller has become increasingly important after getting burned a few times (fortunately on small purchases or items easily returned). There seem to be a lot of knock-offs on the site. And reading your article, I started thinking to myself – this is actually a fair bit of effort I’m having to do in order to build my confidence/trust in the product before clicking. That’s probably not a good thing for Amazon’s brand, and at some point I could see myself getting really frustrated or lose faith in the sellers.
And on a related note, I was struck that while Prime Day was very cool – and I took advantage of some great deals – there seemed to be just a huge amount of junk. It felt a bit like wading through the bargain bin. On the other hand, for the few items I really had my eye on, it was a total pleasure. We took advantage of the great Samsung TV deal, and I again thought to myself as I was sitting on my couch at home in total comfort, ‘This is certainly better than recovering from a head wound sustained from a fellow deal-seeker’s pummeling at Walmart on Black Friday in order to get this TV.’
All this to say – Amazon is certainly cruising along with some mighty momentum, but perhaps should be cautious of the icebergs floating about.
From MNB reader Chris Utz:
One thing I like about Amazon is the strength of the customer review process; which can help a buyer uncover problems, such as the counterfeit products mentioned in your post. If one deep dives into negative reviews, faked or purchased positive reviews can be counter-balanced.
For instance, I was considering purchasing a high-end Nikon DSLR with mostly glowing reviews. I read the fairly a small number of negatives and found something very disturbing. Purchasers complained that the camera, selling only slightly lower than standard retail, was a Grey Market item, which negates Nikon’s excellent US warranty.
I have also read negative Amazon reviews, where buyers said they returned an item, purchasing the (much better) XYZ brand. I’m guessing there may also be false negative reviews, placed by competitors as a form of advertising.
Amazon’s 30 day free return policy is a wonderful safety net. A bad purchase can corrected with a minimal amount of inconvenience. If you are good customer, a phone call to Amazon support can sometimes stretch that 30 day limit.
The bottom line is “Buyer Beware” or more appropriately: Be Aware…
Regarding my skepticism about the Federal Trade Commission (FTC) approval of Anheuser Busch InBev's purchase of SABMiller, one MNB user wrote:
The FTC in approving the AB-SAB merger is essentially restraining competition by allowing the creation of a monopoly and at the same time restricting the common competitive practice of offering incentives to distributors to favor Anheuser or SABMiller brands over competing ones. So all the competing brands have to do is offer no incentives and thereby preclude A-B from offering any incentives. Seems anti-competitive doesn't it.
I took beginning and intermediate antitrust law in law school. I never could reconcile the courts' theories in their seemingly conflicting opinions.
I decided that taking advanced anti-trust law would only add to my confusion.
Meanwhile the FTC seems to not be aware that the Robinson-Patman Act still exists.
In my opinion lack of enforcement of the RP Act over the past 50 years is a major factor in the demise of smaller retailers.
Regarding Procter & Gamble's test of a program that would essentially disintermediate retailers and create a direct-to-consumer subscription program, MNB reader Ron Rash wrote:
Sounds to me as if someone in Cincinnati is just in a snit about retailers. Surely this cannot be their dream for the future of building their brands.
And, on yet another subject, from an MNB reader:
So, Walmart is going to sell imperfect produce with the brand name "I'm Perfect".
Will the class action lawyers have a field day with this?
Maybe "Perfect for You" or "Almost Perfect" were already taken.
On the same subject, from MNB reader Tim Heyman:
Seems to me that the way Wal-Mart handles fresh fruit at stores, most of it ends up being ugly fruit….
Boom!
And finally, we got the following email from MNB reader Sara Freitag regarding Kroger's recent promotion of three women to various presidencies in the company:
Full transparency, I am a Kroger associate.
Kroger has always had a very robust succession plan – it’s great to see the number of female leaders increasing at the highest levels of our organization. This speaks to our core values and the importance placed on diversity/inclusion.
For the umpteenth time, I’m proud to work for this awesome organization.
As you should be.
I agree with you that the new Lake Oswego 365 format has borrowed ideas from TJ and Costco, but I do think they have wound up with a format that has an appealing combo of features.
Interestingly, I think it has the potential to appeal to BOTH millennials and Baby Boomers. The size of the store is great—not too big, not too small. Plenty of category distribution, but with an edited number of brands/SKU’s per category making it easy to shop, and the potential for inventory cost and return improvements.
Key to me will be the quality of the 365 brand…..if quality holds up, the prices are relatively attractive to competitive formats. Also, their pricing in general ... I can't help suspecting some of it was “grand opening” pricing, but we shall see.
I think your C+ is tough! (God help your PSU students this summer.) I’m more in a B to B+ camp!
I'm actually a pretty easy grader. My philosophy is that everybody starts with an A. You have to earn a B or a C.
Also about the 365 store, from MNB reader Randy Evins:
I love the term “derivative rather than differentiated”. If you don’t mind I plan to use it in further blogs and other…. The original Whole Foods was differentiated, even disruptive but not so much anymore. I was hoping 365 would be that “disruption” that would spark others to see new possibilities but I also felt that their structure and methodologies today are not what they were 20 years ago and it would be difficult to overcome the “this is how we do business” intellectual constraint. It’s so hard these days to constantly push that envelope. To not fall back on what we always do, to do things completely off the charts to get that change to stick. It’s especially rampant in traditional grocery as you’ve so often pointed out. It’ll be fun to watch.
Regarding the passing of longtime Walmart executive Don Soderquist last week, MNB user Bob Anderson wrote:
Mr. Soderquist will surely be missed. He was a great leader and our moral compass. Every time you saw him, he would smile, ask how you were, and shake your hand. Mr. Soderquist and his wife have done so much for the Rogers and Bentonville communities over the years, and touched so many. He will be missed, but not forgotten.
One MNB user had some thoughts about the Ahold-Delhaize deal:
With the exception of Aldi, what European grocer has been successful in the US?
The marriage of these two giants will only bring about higher slotting fees, higher
ad and participation fees with less volume than others in the industry. The days
of having more stores means more volume does not necessarily compute.
Then you have Publix, Kroger, Albertsons with a lot of stores that do it right,
or one of the smaller chains like Market Basket, Wegmans, HEB and Meijer that
have fewer stores but do more volume on a per store basis than most.
From MNB reader Joe Axford:
To me these companies couldn't be more different. Stop and Shop is all union, and uses a rewards card. I can't see them having anything to offer Hannaford, other than economies of scale. Just look at the many people from Hannaford who have gone on to great success at other companies. Stop and Shop I can't think of many.
Hannaford would have been a perfect fit for Kroger, as they certainly aren't buying Shaws. Still trying to figure out how Kroger gets into the Northeast, hopefully sooner than later.
On another subject, one MNB user wrote:
Really appreciate your story on the counterfeiter issue Amazon is facing. I’m ‘all in’ with Amazon as a shopper, but I have noticed of late that scanning product reviews and checking the name of the seller has become increasingly important after getting burned a few times (fortunately on small purchases or items easily returned). There seem to be a lot of knock-offs on the site. And reading your article, I started thinking to myself – this is actually a fair bit of effort I’m having to do in order to build my confidence/trust in the product before clicking. That’s probably not a good thing for Amazon’s brand, and at some point I could see myself getting really frustrated or lose faith in the sellers.
And on a related note, I was struck that while Prime Day was very cool – and I took advantage of some great deals – there seemed to be just a huge amount of junk. It felt a bit like wading through the bargain bin. On the other hand, for the few items I really had my eye on, it was a total pleasure. We took advantage of the great Samsung TV deal, and I again thought to myself as I was sitting on my couch at home in total comfort, ‘This is certainly better than recovering from a head wound sustained from a fellow deal-seeker’s pummeling at Walmart on Black Friday in order to get this TV.’
All this to say – Amazon is certainly cruising along with some mighty momentum, but perhaps should be cautious of the icebergs floating about.
From MNB reader Chris Utz:
One thing I like about Amazon is the strength of the customer review process; which can help a buyer uncover problems, such as the counterfeit products mentioned in your post. If one deep dives into negative reviews, faked or purchased positive reviews can be counter-balanced.
For instance, I was considering purchasing a high-end Nikon DSLR with mostly glowing reviews. I read the fairly a small number of negatives and found something very disturbing. Purchasers complained that the camera, selling only slightly lower than standard retail, was a Grey Market item, which negates Nikon’s excellent US warranty.
I have also read negative Amazon reviews, where buyers said they returned an item, purchasing the (much better) XYZ brand. I’m guessing there may also be false negative reviews, placed by competitors as a form of advertising.
Amazon’s 30 day free return policy is a wonderful safety net. A bad purchase can corrected with a minimal amount of inconvenience. If you are good customer, a phone call to Amazon support can sometimes stretch that 30 day limit.
The bottom line is “Buyer Beware” or more appropriately: Be Aware…
Regarding my skepticism about the Federal Trade Commission (FTC) approval of Anheuser Busch InBev's purchase of SABMiller, one MNB user wrote:
The FTC in approving the AB-SAB merger is essentially restraining competition by allowing the creation of a monopoly and at the same time restricting the common competitive practice of offering incentives to distributors to favor Anheuser or SABMiller brands over competing ones. So all the competing brands have to do is offer no incentives and thereby preclude A-B from offering any incentives. Seems anti-competitive doesn't it.
I took beginning and intermediate antitrust law in law school. I never could reconcile the courts' theories in their seemingly conflicting opinions.
I decided that taking advanced anti-trust law would only add to my confusion.
Meanwhile the FTC seems to not be aware that the Robinson-Patman Act still exists.
In my opinion lack of enforcement of the RP Act over the past 50 years is a major factor in the demise of smaller retailers.
Regarding Procter & Gamble's test of a program that would essentially disintermediate retailers and create a direct-to-consumer subscription program, MNB reader Ron Rash wrote:
Sounds to me as if someone in Cincinnati is just in a snit about retailers. Surely this cannot be their dream for the future of building their brands.
And, on yet another subject, from an MNB reader:
So, Walmart is going to sell imperfect produce with the brand name "I'm Perfect".
Will the class action lawyers have a field day with this?
Maybe "Perfect for You" or "Almost Perfect" were already taken.
On the same subject, from MNB reader Tim Heyman:
Seems to me that the way Wal-Mart handles fresh fruit at stores, most of it ends up being ugly fruit….
Boom!
And finally, we got the following email from MNB reader Sara Freitag regarding Kroger's recent promotion of three women to various presidencies in the company:
Full transparency, I am a Kroger associate.
Kroger has always had a very robust succession plan – it’s great to see the number of female leaders increasing at the highest levels of our organization. This speaks to our core values and the importance placed on diversity/inclusion.
For the umpteenth time, I’m proud to work for this awesome organization.
As you should be.
- KC's View:
