Westfield's Giant touch-screens to simplify shopping, outside the store…

Digital Storefronts by Westfield Labs & eBay, Inc. from Westfield Labs on Vimeo.

A mere stepping stone to giant touch-screens...

                                                                                                                                  Pics: Westfield Labs

Following on from the launch of Digital Storefronts, Westfield Labs, the digital division of Westfield shopping centres have developed 7-foot tall, ultra-high definition (4k) touch-screens that allow visitors to discover new products offered by retailers at the shopping centre in real time.

High grade images rotate on the screens, and visitors are able to approach and engage with the displays with the touch of a finger. By scrolling, zooming and rotating through the retailer curated collections, visitors can find shopping inspiration and even display a map of exactly where individual products are found in the shopping centre so they can go experience them first-hand.

Currently available on level 2 in the common area of the new Premium Fashion District of Westfield Garden State Plaza in Paramus, New Jersey.

A giant leap for Westfield, and a small step ahead of Amazon*,  for the moment.....

* See 'Aggressive' Amazon a real threat to retail – says Westfield’s chief digital officer today in London here

Walgreens likely to bid for early Boots takeover?

Alliance Boots could be wholly owned by America’s largest drug-store chain within eight months. Walgreens, owners of a 45% stake, have an option to buy the remaining 55% between February and August next year.

Meanwhile, Alliance Boots already has 2,487 shops in the UK which includes 2,385 pharmacies and an additional 750 pharmacies could turn it into the 800 pound ‘gorilla in the market’.

However, an attempt to buy the whole of the Co-op’s pharmacy business would be likely delayed by the UK’s Competition and Markets Authority (CMA), probably leading to a prolonged sell-off of overlapping outlets. 

The key issue for NAMs is ‘Why the rush?’
Given that an advantage of the move would allow Walgreens to re-domicile its tax base to the UK or more likely Switzerland, thus reducing its corporation tax rate from the US 37% to the UK 21%, and even less in Switzerland, the decision is a no-brainer…

Also, as such a move would be the latest in a succession of tax inversion moves by leading US companies, it is likely that the US government will try to limit potential losses to their exchequer by interfering in the process before long…

So, the sooner, the better…especially as the partial merger has already yielded $154m in synergies, more than the anticipated $150m, i.e. the merger is patently working, in stock-market terms…

Unfortunately, such moves added to the possible Co-op bid, have placed Walgreens and Boots above government radar in a number of tax jurisdictions, likely to cause much potential distraction when the company simply wants to achieve global scale as soon as possible.

Meanwhile, NAMs and the retail competition could be advised against ‘waiting to see what happens’ instead of anticipating that Walgreens–Boots will simply take these ‘distractions’ in their stride.

In other words, time for NAMs to climb aboard now and incorporate WB into their global trade strategies, before WB does it on their terms…

Dixons-Carphone: Fingers crossed or uncrossed?

The morning after, opinion seems divided on whether Dixons-Carphone is a marriage made in heaven, or a countdown to divorce...

The issue revolves around a definition of show-rooming. In other words, is show-rooming a means of learning to buy by touching, or simply a way of accessing advice?

Historically, a shopper wanting comprehensive advice on anything more than operating the on/off button in Dixons has allegedly been left wanting… Indepth advice on any gadget is now more comprehensively, objectively and effectively accessed via the internet.

In the same way, category context i.e. a fully comprehensive range of products from which to focus shopper-choice is physically difficult to provide at store level, compared with browsing Amazon.

However, if the function of ‘gadgets’ stores is now intended to provide an opportunity to ‘buy’ by touch, then it is vital for a retailer to provide a seamless wifi instore opportunity for shoppers to complete their online product assessment in the aisle, and reduce prices to a point that makes the switch to online purchase less attractive…or provide an online facility better than Amazon…

Even if the shopper can be brought to this point without leaving the store (to await the delivery now due from Amazon?), Dixons-Carphone will require highly skilled floor-staff to then gently facilitate the completion of the purchase, without the anticipated tussle ref warranties…

All told, NAMs need strong customers and probably have high hopes of a successful merger, fingers crossed….

However, given the multichannel hurdles involved and their real-world experience, NAMs may decide to invest in alternative options, fingers uncrossed…

Dixons Carphone - why Walgreens-Boots is different...

The Dixons Carphone merger is the latest in a series of retail unions’ response to structural change in retail…

Key metrics
The £3.8bn 50-50 partnership to be called Dixons Carphone will result in a £12bn turnover company, made up of Carphone’s £3.7bn and Dixons £8.2bn.
In terms of stock market value, Carphone's market capitalisation is £1.9bn and Dixons' is £1.87bn
Carphone's 2,037 stores worldwide and Dixons' 947 stores will overlap and synergies will result in annual cost cuts of at least £80m within three years.

Previous retail mergers
Think about the troubled history of retail unions (see Alex Lawsons’ article in the Independent for details) so far:
- Abortive Carphone - Best Buy European joint venture in 2008
- Asda's doomed merger with furniture specialist MFI in 1985
- Morrisons’ takeover of Safeway in 2004 took longer than expected to bed in..
- The Co-op – Somerfield larger store sell-off
- Asda's acquisition of Netto in 2010, sell-off of 25% stores
- Kingfisher's troubled merger of B&Q with the French DIY retailer Castorama in 1998
- Kingfisher’s attempted a merger with Asda in 1999, resulting in Walmart bid

NAMs have to ask themselves if the Dixons-Carphone merger has enough potential to survive, or is even worth the effort…

Meanwhile, the Walgreens-Boots takeover appears to have a number of advantages
- Geographically complementary in that Walgreens is US only, Boots is rest-of-world
- Broadly complementary business philosophies and product assortments
- Potential synergies re retail expertise exchange
- Purchasing synergies already realising $154m

However, the real advantage over previous retail unions arises from the two-step deal (i.e. part–purchase in 2012, final takeover by 2016) which was designed to allow Walgreens and Alliance Boots to come together gradually and integrate, while continuing to drive their independent strategies in the first years of collaboration…

Sometimes slow is better, even in FMCG retailing…

Empty shop squatting - a high-street solution for a high street problem?

A new business has been designed to protect empty shops from squatters by moving in low-paying renters.

Intuitive Guardians’ new scheme aims to close a loop hole in 2012 legislation, which made squatting in residential properties a criminal offence but does not stop squats being set-up in commercial properties.

The business model has the firm supplying basic shower block and kitchen amenities, property owners paying as little as £50 a week to have their property secured while prospective guardians can get living space in Brighton and Hove at a heavily reduced rate of just £50 a week.

Apart from space protection, the key benefit has to be that local councils, businesses and shoppers become accustomed to a more 'lived-in' high street environment, and will hopefully lead to more creative use of a dying facility...

Life after a mega-merger – some pointers for NAMs

First, the basics…

Companies merge in order to release synergies and save costs. Anything other than a 50/50 split is a takeover, resulting in a faster rate of change and a little more bias in favour of the stronger party…

Logically, as a single, combined company they now need one head office and as much rationalisation of Production, Finance and Sales/Marketing as is feasible. Any obvious overlap of key staff will be eliminated, quickly or slowly, depending upon the new corporate culture. Depending upon the scale of the deal, government will interfere in any ‘vote-losing’ moves such as factory closures in high unemployment areas.

In the interest of abiding with competition legislation there will be an obligatory sell-off of brands that would otherwise result in dominance of a category in a manner that could cause issues with the government. This will result in windfall opportunities for brand acquisition by third parties…

The above description of the process may differ a little from the official press release at the time, but such is the nature of the real world…

However, from a NAMs point of view, the real issue is how to help retail customers to cope with the transition…

Action:

1. Avoid possibility of cherry-picking of best terms and conditions by strong retail customers.
2. It is vital to conduct a total re-assessment of relative competitive appeal for each of the company’s key categories.
3. Given inevitable changes to the overall portfolio, it can be helpful to re-visit ways of growing the business.
4. Helping the new company raise its share price via ROCE improvement provides a useful starting point for a pro-active NAM.

More details in the current subscriber edition of NamNews.

Now is the discount of our winter-tents?

Aldi have launched two ranges of low-cost camping gear - for adventurers and family campers.
However, to the undoubted relief of retail camping specialists, the products - ranging from head torches to satellite TV kits - will only be available at Aldi's UK stores for a limited period and once stocks have sold out they won't be replaced....

However, if this camp-gear approach to instore theatre makes an impact.....

NIVEA Child-minder App

The app that helps you locate your kids on the beach via a sunscreen print-ad cutout bracelet.

This app is a tool for you to monitor your kid’s location, designed by Nivea Brazil and their agency FCB. Detach the bracelet from the NIVEA SUN Kids print on Revista Veja (04/23/2014 edition), download this app and use the Bluetooth 4.0 technology to monitor who is using the bracelet up to a distance of approximately 30 meters.

You can set an alarm to sound at the distance you define, within an approximate range.
See the clip here

A no-brainer for beaches everywhere, but why stop at beach-applications when kids need watching 24/7...