business news in context, analysis with attitude

Got several emails responding to yesterday's story about PetSmart buying e-commerce site Chewy.

MNB face Glen Terbeek wrote:

Here is another example of a large, established company buying innovation and its future from a recent startup. Could it be that the company's organization, measurements, old industry practices, quarterly results focus, and risk adversity won’t let them deal with the the future changing marketplace internally? They are the perfect kind of company that is targeted by “disruptors”; startups without any “historical" barriers.

The question, of course, is whether the big company ends up killing or nurturing and learning from the small company. It can work, or it can go sideways.

And, speaking of potential going sideways, one MNB reader wrote:

I have been in the Pet Industry for over 40 years. What I see here could bring another view more than just the drive for a strong e-commerce platform. Like most brick and mortar, Petsmart has been very strong to the vendor community to proceed with MAP policies. Chewy is like Amazon and lives in the free flow of a free marketplace. Trying to get Chewy to go with MAP pricing is nearly impossible. With this we have not shipped Chewy, nor Amazon and now we play that game of wack a mole as we make efforts to stop our distributors from selling these who don’t follow MAP. So will Chewy change and follow the parent in Phoenix or stay with the free market side that got them to have the following they do?

MNB reader Jessica Duffy had some thoughts about Whole Foods' "whole-paycheck" issues:

I feel that in regard to basic grocery products, Whole Foods prices are reasonable and competitive for real food that isn’t stuffed with a bunch of cheap fillers, as well as additives and preservatives. And then, Whole Foods has all those amazing fun things that are specialized or local and more more expensive to produce. The products are vetted extensively, come to Whole Foods shelves, and then are commandeered by other johnnie-come-latelies who did not have the costs of ensuring the level of quality necessary to put a product on Whole Foods shelves.

May I also add, that other grocery retailers do not have anything close to the quality of Whole Foods produce, let alone mandatory humane standards, where even the 1st level is far above what animals face in conventional production. And did I mention the seafood sustainability standards? So many “competitors” are merely jumping on the work done first by Whole Foods and then Whole Foods gets bashed for having higher prices.

We also reported the other day about how Taco Bell uses social media increasingly to make decisions about new product introductions, often using pictures to communicate with customers.

One MNB reader wrote:

There is no resemblance between the Taco Bell items seen in commercials and how they look when you buy one in store.  Not sure that pictures of store purchased food is in their best interest.

I was thinking this the other day, but I sometimes am accused of being too snarky about many fast food chains. I decided to let this pitch go by ... but am glad that someone else took a swing at it.

Finally, we took note the other of a CNBC report that new data from The NPD Group's Checkout Tracking Service "suggests that Americans as a whole tend to be value-driven consumers, with about 95 percent of US shoppers buying something at a Walmart during 2016, and 89 percent buying something at a McDonald's. In third place was Target, where 84 percent of Americans shopped last year."

Prompting one MNB reader to write:

Although I’m sure the numbers are high, I have trouble believing they are really 95% and 89%. I have not entered either of those establishments in at least a decade and I don’t know many people who have….

I think one has to be careful about statements like these. There are a lot of retail establishments that I haven't patronized over the past decade because they are neither relevant nor compelling to my life ... but that doesn't mean that they aren't hugely popular with people elsewhere in the country with entirely different interests and priorities.

One has to be careful about epistemic closure.
KC's View: