Asda playing instore...?

Given increased supply-chain efficiencies, coupled with shopper reluctance to drive out-of-town, resulting in increasing redundancy of large-space retailing, Asda appears to be following Tesco’s lead in seeking to buy businesses that might complement their retail offering whilst absorbing overheads.

The Daily Express reports that Asda is rumoured to want to buy out the Early Learning Centre, given Mothercare’s struggles…

Apart from a good purchase price, the ELC would be a natural fit in terms of family offering, but could also add to instore theatre and enrich the shopping experience whilst keeping the kids amused.

Great news for toy suppliers, but a possible threat for NAMs in less exciting categories…? However, surely this presents an opportunity for extra creativity that might also be rolled out elsewhere?

Friday What-if: Why CVS Is Quitting Tobacco and the UK/EU implications

CVS Caremark Corp is a $123bn American retailer and health care company that has announced it will stop selling tobacco in October 2014, and focus on healthcare provision.

Respondents to Andrew Sullivan's blog add some interesting insights:

• CVS own Caremark RX, a huge pharmacy benefits manager (PBM), managing the prescription drug components of Medicare and other public and private insurance programs
• Pharmacy chains have been providing the care that more traditional medical practices cannot, with CVS clinics rising from 800 to 1,500 by 2015...
• CVS has between 30 and 40 partnerships with healthcare systems across the US
• CVS shares the retail-clinic space with Walgreens, Target and Walmart, and the CVS tobacco move could cause these three players to make similar moves re. tobacco, alcohol and even shotguns..
• Junk food and drinks have to come under the same spotlight as the healthcare market expands...
• The $2bn lost in tobacco sales will need replacing...

So, apart from some fundamental changes in US retailing, the key issue for UK/EU NAMs has to be the impact of McKesson and Walgreens expansion into Europe on CVS.

What-if CVS decide to copy the McKesson move and acquire some healthcare wholesalers, say Phoenix for starters?

To give you some idea of the scale of the issue and the money involved, some 2012 sales figures:

CVS Caremark                    €90.5bn
McKesson-Celesio              €115.3bn
Alliance Boots-Walgreens    €80.7bn
A.S. Watson                       €14.2bn

Apart from pushing Alliance Boots-Walgreens down into third place, with the right acquisitions, CVS could even take the No.1 slot...

Watch this space... 

London's first pay-per-minute café facing closure?

Ziferblat is a social network in real life! At 388 Old Street, Shoreditch, London, EC1V 9LT, the café opens from 1000 to midnight, and charges 3p per minute.

For NAMs willing to try, you pick up an alarm clock on arrival, note the time, and check out on completion. Complementary snacks and coffee are available 'on tap' and even bespoke coffee if required.

However, rather than being inundated with 'smash & grab' free-loaders making it uneconomical, Ziferblat, the country’s first pay-per-minute café, is facing closure less than three months after opening because of a lease dispute. According to The Standard, Ziferblat’s role as a café where customers make their own coffee and food, but pay by the minute, means it falls into a legal grey area between being classed as a “shared workspace” and a venue “selling food and drink”.

Hopefully, ways can be found to live with the bureaucracy, avoid biting the dust, and allow the emergence of a new approach to food service...

Rebuilding consumer confidence - the brand role

Nielsen's latest Global Survey of Consumer Confidence reveals that in Q4 2013, 60% of Britons are seeking to reduce their electricity bills, 58% have cut back on expanding their wardrobes, 57% have cut out takeaways and 55% are switching to cheaper brands in the supermarket.

As reported in The Guardian, the poll of 30,000 people has uncovered the first dip in consumers' confidence since 2011. Chris Morley, managing director of Nielsen UK and Ireland, said: "British consumers are increasingly recognising improvements in the economy, but they are still cautious and likely to continue to modify their buying and consumption habits to save money"

It is obviously impossible and inappropriate for brands to attempt to shift the mood of the entire population, that being a job for the politicians (!). Better for brand owners to focus on that pool of loyal users, the ones that have remained loyal despite the pressures and blows to credibility (horsemeat etc), the consumers that continue to believe in your brand, albeit at reduced consumption levels.

Working from what you know works, it can be easier to encourage existing users to consume more, rather than trying to attract new users to the brand.

• A key first step is to reassess latest consumer needs vs. brand attributes
• ...and checking that the brand delivers more than it says on the tin, every time....
• Check post-consumption delight -who needs satisfaction...?
• Optimise consumption levels by ensuring 100% onshelf and multichannel availability 24/7 - why take a chance on preventing any potential consumer from accessing your greatest asset?
• Share with consumers other uses of the brand revealed by regular users
• Then begin to encourage existing users of your current brand to try another brand in your portfolio, capitalising on your mutual knowledge and emerging confidence in the relationship

When loyal consumers have experienced and have confidence in your offering on these two levels - existing and new products - it is time to build on the ability of satisfied, savvy consumers to tell their friends....

A slow approach?
Then how about taking a chance on delivery vs. promise, and allowing the other half of the 'tell a friend' mechanism to kick-in, whereby a delighted consumer tells one friend, whereas a complaining consumer tells ten eager listeners, via every medium available...much, much faster! 

Economic crash...

Source: The Slog

Ten fastest growing jobs in US at risk from automation

The Atlantic reports a recent Oxford University study by Carl Benedikt Frey and Michael A. Osborne that calculated the odds of "computerization" for the 600+ jobs that the US Bureau of Labor Statistics tracks. They range from 96% automatable (office secretaries) to 0.9% (registered nurses).

Here are the ten fastest-growing jobs and the odds that robots and software will replace them:

1) Personal care aides: 74%
2) Registered nurses: 0.9%
3) Retail salespersons: 92% i.e. shop-workers
4) Combined food prep & serving workers: 92%
5) Home health aides: 39%
6) Physician assistant: 9%
7) Secretaries and admin assistants: 96%
8) Customer service representatives: 55%
9) Janitors and cleaners: 66%
10) Construction workers: 71%

Obvious food for thought, given that NAMs do not feature on the list....

In fact as Derek Thompson points out in The Atlantic article, computers are historically good at executing routines, but they’re bad at finding patterns, communicating with people, and making decisions, which is what managers are paid to do. This is why some people think managers are, for the moment, one of the largest categories immune to the rushing wave of AI.

Time for emphasising your skills at  finding patterns, communicating with people, and making decisions, and above all, avoid allowing the job to become dull, boring and repetitive, just in case...

Hat-tip to Andrew Sullivan

Self-checkout rage: Nearly one in five self-checkout shoppers steal goods at the bagging area...

In a survey of 2,664 people by VoucherCodesPro, reported in the Telegraph, one in five admit that self-checkout rage causes them to steal an average of £15 of mainly fruit & veg per month, although toiletries account 26% of items stolen.

The results suggest people steal regularly once they realise they can get away with it – with 57% of the thieves admitting they first took goods because they couldn’t work the machines, and 51% believing they are less likely to be caught.

Given that retailers introduced self-scanning/checkouts to reduce labour costs, it obviously negates the advantage to add a team of one-on-one 'helpers' to the self-checkout area...

One solution might be to try the Costco idea of spot-checks of bags vs. receipts which does not appear to cause offence...? 

Alternatively, why add this new 'route to theft' to 'grape-grazing', aisle-snacking and other methods that regular shoppers use to help retailers maintain high shrinkage levels...?

US shops that only offer food past its sell-by date

According to today's news in the Guardian that a man is to be put on trial in February after he was allegedly caught stealing from the bins behind an Iceland store in London, it appears that Freegans, or bin scavengers, are becoming a feature of the current flatline environment.

Paul May, a freelance web designer, is expected to argue in court that he does not consider taking the mushrooms, tomatoes, cheese, and cakes from the garbage outside of Iceland as illegal, because the food was  going to be disposed of and he needed it to feed himself, the Guardian reported.

Given that the Freegan movement started in New York a decade ago, it follows that the US should be first in opening stores that only offer food that is past its sell-by date.

Doug Rauch’s new venture The Daily Table, due to open in May, in Dorchester, Massachusetts, will be part grocery store and part cafe, specializing in healthy, inexpensive food and catering to the underserved population in Dorchester, Mass. What makes it controversial – at least at first glance – is Rauch’s business model: His store will exclusively collect and sell food that had crept past its “sell-by” date, rendering it unsellable in other, more conventional supermarkets.

But the real challenge, in Rauch’s vision, isn’t just getting that excess food to the people who need it. It’s convincing them that it’s worth eating.

Rauch is looking for a market-driven solution to food waste. The store will be a non-profit, but after an initial round of funding gets it started, he intends for it to be self-sustaining.

Interesting to see how long after the Freegan Garbage theft trial, the UK follows the US example with shops offering past sell-by food...

...and as an extension of consumers' tendency to 'make do', how much demand will be taken out of the market...

NB Update on Iceland Three case:
Following an outcry on Twitter and questions about the public interest value in pursuing a prosecution – with even bosses at Iceland expressing doubts – the Crown Prosecution Service today announced that it was dropping the case.