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12
Jun-19
Wednesday

Dollar General plans to open 975 stores this year

7
CBS News reported that Dollar General is planning to open 975 stores in 2019, making it the top US retail company for expanding so far this year. But it's not the only dollar store prospering as many once-mighty retailers are forced to fold after years of debt financing or competition from Amazon. After Dollar General, discount chains Dollar Tree, Family Dollar, Aldi and Five Below are in the top five for opening stores in 2019. Out of nearly 2,780 stores slated to open in the US thus far in 2019, about 1800, or more than half, are from discount chains. Dollar stores stock goods, such as milk and bread, that make them a convenient stop for shoppers on their way home from work - and, therefore, resistant to a digital takeover. They also perform well with consumers in all markets, rich or poor, urban or suburban.  
11
Jun-19
Tuesday

Walmart employees will soon stock your fridge themselves

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The Verge reported that Walmart announced it will bring “InHome” delivery to customers in select US cities this fall - a program where customers can opt to allow direct delivery to their refrigerators. While there were no details of “how,” Walmart said it will use its own workers to open your door and walk into your house when you aren’t home. Walmart said it will give its employees detailed training to ensure they “treat customers’ homes with the same care and respect with which they treat a friend’s or family’s home.” InHome will compete directly with Amazon’s Key home delivery service, which can deliver your packages inside your home and elsewhere. Reuters reported that Walmart tested a similar D2F (direct-to-fridge) delivery service in 2017, but it was disbanded a year later.

Aldi moves into Walmart's backyard

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CNN reported that less than a mile from Walmart's massive headquarters in Bentonville, Arkansas, US, a new neighbor has settled in: German discount grocery store Aldi. It's part of Aldi's US$5 billion plan to expand to 2,500 stores in America by the end of 2022. Aldi is on track to become the third-largest grocery chain in the country behind Walmart and Kroger. Aldi hopes to win over Walmart customers with rock-bottom prices and its own private brands. More than 90% of the brands Aldi sells are its own private labels. Aldi also features several quirks not typical at other American grocery stores - the need to rent a shopping cart, bags are only available for a fee, and cashiers hurry shoppers away expecting them to bag their own groceries. These tactics help Aldi drive labor costs down. Walmart executives are taking Aldi seriously and have lowered prices in some markets to counter Aldi. Goes to show, despite all the talk about customer experience, winning in today's retail landscape comes down to consistency of service and operational excellence to ensure a low-cost base.

Bookstore giant Barnes & Noble sells for US$476m

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The Hustle reported that hedge fund Elliott Management has acquired Barnes & Noble for US$476m in cash. The sale was announced last week after months of drama and conjecture over the fate of the bookstore behemoth. Would there be a bailout? Or would Barnes & Noble merely be an historical tale we tell our grandchildren? The ending seems to be a happy one. Time will tell if the outcome is only a misdirect. The middle-aged bookseller started as a single Manhattan storefront in 1971 and later evolved into a national chain of book superstores. But in recent years, the word-mecca has been rocked by the Amazon reign - struggling to make a profit. In the last decade, the online reckoning forced the chain to close more than 150 stores - down to 627. The acquisition has curbed fears among publishers and agents for now, but like all good stories, there’s usually an ending.
10
Jun-19
Monday
7
Jun-19
Friday

Kogan to face ACCC in court

10
The AFR reported that Kogan will appear in the Federal Court in Melbourne today to answer allegations made by the ACCC that it made false or misleading representations by offering fake discounts to consumers in a tax-time promotion last June. The ACCC alleges Kogan raised the prices of more than 600 products by about 10 per cent immediately before offering a 10 per cent discount at the checkout. Towards the end of the promotion, Kogan told customers they had “48 hours left!”, allegedly giving customers the impression they had only a limited time to purchase at the “discounted” prices. However, Kogan reduced the prices of the products shortly after the promotion ended, with many prices returning to their pre-promotion prices, the consumer watchdog alleged in a court filing last month. Kogan, which denies the allegations, has yet to file its defence, but the online retailer gave a taste of its argument in an advertisement for a 48-hour tax-time promotion at the end of May.

The dark side of the cloud

6
The Hustle reported that earlier this week Google's cloud went down, taking Gmail, the G Suite, and YouTube offline across the US and Europe. But it wasn’t just Google’s well-known products that went down: Snapchat, Apple’s iCloud, and many Nest products went offline, raising questions about the dark side of the cloud. As cloud technology powers more and more of our lives, it also causes more and more problems when it goes down. Case in point: When the cloud went down, people who use Google Fi couldn’t make phone calls, and others who own Nest devices couldn’t turn on their air conditioners, check on the sleeping babies, or even enter their locked homes. The outage exposed the flaws of a world where most of a person’s vital services are controlled by a single company without backup. This is exactly why brands cannot solely rely on the cloud for critical customer touchpoints such as Point of Sale.
6
Jun-19
Thursday

Woolworths jumps on the convenience bandwagon

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Woolworths is changing the way it operates more than 1000 supermarkets in response to growing customer demand for convenience, fresh food, and better service. In the first change to its store operating model since 2011, Woolworths is creating two new departments: fresh service and fresh convenience. Fresh service will manage customer service at delicatessen, butchery and seafood counters, and fresh convenience will manage dairy, eggs, pre-pack meat, branded bread and meal solutions. Sounds eerily familiar to Coles' latest strategic misadventure. Speaking about Coles, the grocer is unwinding house brand milk contracts with dairy processors such as Murray Goulburn and shifting towards direct sourcing agreements with individual dairy farmers. The move was welcomed by dairy farmers, who said it would have no impact on retail prices but would give farmers supplying house-brand milk price certainty for the next three years.

Toys R Us returns to Australia

9
The AFR reported that family-owned online retailer Hobby Warehouse expects sales to double and triple over the next few years after acquiring licensing rights for the Toys R Us and Babies R Us brands. Hobby Warehouse, which is owned by Louis Mittoni, has signed an exclusive 30-year licensing agreement with Tru Kids Inc, the new owner of Toys R Us and Babies R Us, and will relaunch the brands online in Australia and New Zealand next week, 12 months after Toys R Us Australia was wound up and all 44 stores were closed. Hobby Warehouse also plans to open bricks and mortar Toys R Us and Babies R Us stores in a year or two.  The new stores will be much smaller than the previous big-box stores and will enable customers to touch and feel toys and games before ordering online and having orders delivered to their homes. Toys R Us was Australia's largest toy retailer, with a 20% share of the market and sales of about $290 million, before it collapsed in May 2018, owing creditors about $95 million.

The ugly side of L’Oréal’s mission to bring augmented reality to makeup

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The Hustle reported that the French beauty business L’Oréal announced plans to integrate its ModiFace augmented reality (AR) makeup tool with Amazon, which will enable millions of additional shoppers to “try on” lipstick in live selfies. L’Oréal acquired ModiFace last year to boost digital sales, and indeed, according to last year’s annual report, “increasingly realistic simulations... have a strong impact on sales.” But while filtered faces pull in a pretty penny for L’Oréal, they also cause an ugly increase in body-image disorders and unnecessary plastic surgery among kids, according to a body of medical research. Researchers have already documented the harmful impact of Snapchat’s selfie filters on the mental health of kids. But ModiFace’s filters - which are used in 75 of the 100 top beauty brands’ apps and now funded by the world’s largest cosmetics company - are far worse: Not only do they distort people’s perception of themselves, but they also profit from that distortion by selling a solution to it.  
5
Jun-19
Wednesday

Omni-channel is dead?

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An article in Forbes debates that nearly 16 years since its apparent coining, "omni-channel" as a concept it is now well past its expiration date. The author states that, first, it was always ill-defined. Second, it was often served up as the panacea for what ailed every struggling retailer. Simply stated, a great customer experience has never been about being everywhere and being all things for all people. What matters is showing up for the right customers, where it really matters, in remarkable ways. Coining a new term, "Harmonised Retail", the piece states that a winning customer experience strategy recognises that the blended channel is the only channel and that retailers need to leverage deep customer insight to understand how various customer segments navigate the customer journey across digital and physical channels. With harmonized retail the aim is to have the critical aspects of the customer journey all sing beautifully together.

Buy now, pay later services propping up sluggish retail sales

5
The AFR reported that buy-now, pay-later players are propping up the weak retail sector, with estimates from UBS suggesting the payment channel makes up more than half of online sales for some retailers. The latest data from the Australian Bureau of Statistics shows retail sales fell 0.1% in April 2019, seasonally adjusted, following a 0.3% rise in March 2019. Leading the decline was spending on clothing, footwear and personal accessories, which fell by 1.2% over the month. Spending on household goods and cafe, restaurant and takeaway food fell by 0.9 and 0.7% respectively. Department store spending, other retailing and food retailing all went up over the month. UBS analysts estimated that in the six months to December 2018, listed buy-now, pay-later providers Afterpay and Zip accounted for about 16% of the growth in discretionary retail spending. This is up from an estimated 14% in the six months to July 2018.