business news in context, analysis with attitude

Regarding my story about the power of subscriptions and auto-replenishment, MNB fave Glen Terbeek wrote:

Subscription works great for each shopper's “staple” items (items they use all of the time).  And of course the manufacturers love it.

I would guess that Amazon doesn’t buy and resell these items, they just get a fee for providing the service of connecting the shopper to the items they want. In fact I doubt that they buy or resell any item they carry.  They do it for a service fee paid by the manufacturer.  It makes sense, virtually, since the manufacturers compete directly with their competitors with out retailer interference. And any item can reach the market place that the manufacturer wants to risk making available.  One more point, Amazon acts as value added aggregator, they make any item available and and provide filters to help each shopper make a choice.

Of course the retail store is another model.  Here the retailer is making choices for their local value added store markets.  So they should "buy for resale” since they are taking risks deciding which items to carry in the limited space available in each store.  

Of course the long term shopper model is a continuum of real stores and virtual shopping where the retailer serves as an agent of the shoppers. Real value added stores for information, solutions, education, social, etc and virtual shopping for each shoppers staples for pick up or delivery.  This would be supported by a “barrier buster” providing the support for the retailer’s virtual shopping shopper interface.

It is (past) time for the industry to realign its practices and economics starting with the shopper and working backwards. 

Also regarding subscriptions/auto-replenishment and the opportunities they offer, one MNB reader wrote:

Amazing...what data can do ... if used.

Few things in retailing are more powerful than actionable data actually acted upon.

Can I get an Amen?

Responding to this week's FaceTime video, "Scene from a Mall," one MNB reader wrote:

It is quite sad to see the mall in that condition. A lot of things that retailers can do with that space. To built ultimate shopper loyalty and provide service to the communities malls should consider a hybrid housing/retail model. Not only will the people living in that space primarily shop at the retailers in the same space - it will give malls a new meaning and point of attraction. Alternatively, they could turn the mall into the metaverse by inviting digitally native brands to set up shop or social media/gaming companies (like Meta or Microsoft) to set up shops where people can get into virtual reality, learn how digital etiquette or host coding camps for kids.

Possibilities are endless and with so many closed shops, any ideas will boost the bottom line. 

On another subject, from an MNB reader:

I just read Mike Overschmidt's response to you on the economy and student debt. His comment on eliminating the interest is the best idea I have heard and one I would support. Eliminating the debt entirely to me is unfair to those who paid their loans off ( me and my kids) or chose not to go the college route. When the government stepped in and took over the student loan business their rates seemed out of line  contributing to the higher costs of college.  It always struck me that when my oldest went to college the tuition went up $1,000 -1,5000 annually which was in line with the step increases in the parent college loan borrowing limits. Seemed awfully coincidental and this way the amount left owing was constant over five years. I also believe the colleges should have skin in this game as they contributed in many ways to the problem. One of the tricks many colleges used was treating students who lived away from home as emancipated from their parents and applied through the school's student aid office for pell grants. The colleges don't care where the funds come from as long as the tuition money continues to flow in.

One MNB reader wrote in about CVS's layoffs, and my characterization of the chain as "mediocre:"

For several years I was a client of the (various) CVS prescription programs.  I had an automatic debit to my credit card.  When I moved out of the US (to a place with much cheaper name brand drugs) I sent an email asking that the plan be terminated.  I was directed to a website that had a form.  However, because I was not in the US, I could not access the form.  For over a year I had to reject the charge to my credit card every month.  Finally, I contacted a top official of CVS who agreed to help me.  He talked to the right people and then told me they needed my phone number to discuss the situation.  Several days later he told me they were having trouble dialing an international number! I was dealing with the C-level people.  I gave them my email and the problem was fixed.  If it were not for that one person willing to help a departing customer, I would still be dancing with them on the credit card debits.  I hope they do not cut down on use of consultants for customer service.

MNB reader Pat Smith reacted to my piece about Barnes & Noble's new strategy of empowering store managers:

My initial retail experience was with Albertsons Stores in the ‘60s. they operated much the same way. There were guard rails, but individual store managers had great latitude to operate their stores with an individual flair. Department heads operated in the same fashion. Albertsons also had a lucrative bonus program for its store management. As to the grocery business if a chain operates in a large metro area it is reasonable that incomes and ethnicity, both having impacts on customer purchase patterns, will vary widely. A well run retail operation can and should be able to adapt to local market conditions.

And finally, regarding the popularity of tavern-style pizza, one MNB reader wrote:

Typically, here is Chicago, where the best pizza in the U.S. is found, our spectacular tavern style is our everyday pizza of choice. Deep dish (and its variants such as Stuffed Crust) is our choice for special occasions or when hosting out-of-towners. Can’t go wrong ordering either and most pizza shops offer delicious versions of both thick and thin crusts.