Amazon Opening Bookstore in Chicago
PW: "Amazon has confirmed that it is opening another bricks-and-mortar store, this one in Chicago. The mega-retailer told the Chicago Tribune that the store will be located in Chicago’s Southport Corridor and is set to open next year. The 7,200 sq. ft. location is on the former site of the Mystic Celt bar and grill at 3433 N. Southport Avenue. This will be Amazon’s second beach head in Chicago. Last week it announced that it will open its first pickup location in the Windy City later this year. The 2,300 sq. ft. pickup spot will be located at the University of Illinois at Chicago’s Student Center East... Despite comments by a mall chain operator CEO in February, when Sandy Mathrani at General Growth Properties said Amazon plans to open 300-400 bookstores, the tech giant has moved relatively slowly on opening additional bricks-and-mortar locations. Amazon's second physical bookstore, slated for San Diego this summer, has yet to open. A third store is expected to open later this year in Portland, Ore., but no opening date has been set yet..."
Study Shows Celebrity Tribute Issue Readership Lifts
New GfK MRI research documents particularly large readership lifts for some recent celebrity tribute issues. Those that drove the highest average lifts were Robin Williams (29% above the magazines' normal average readerships), Muhammad Ali (28% above average) and Prince (25% above average). The research examined 112 magazine issues over the past eight years and focused on celebrities that were featured on at least three covers. The highest level of single-issue readership average were noted for People’sDec. 29, 2014 Robin Williams issue; Sports Illustrated’s June 13, 2016 Mohammad Ali issue; and Rolling Stone’s May 19, 2016 Prince issue. All three achieved a readership levels that was 40% above each brand’s average. Also notable was People’s Sept. 28, 2009 Patrick Swayze tribute, which had a readership increase of 32%." People tells MIN that after the unexpected death of Prince on April 21, the brand offered breaking news, features, and video on its site, and created two dedicated Snapchat editions, plus several Facebook Live reactions as the news broke--culminating with the cover of People’s commemorative Prince issue--the magazine's biggest newsstand seller of 2016 to date. SI's Ali tribute was also among Time Inc.'s biggest-selling issues YTD.
Speedimpex CEO Killed in Italy's Earthquake
In an email to clients, Speedimpex Group announced that its president and CEO has been confirmed to be a victim of the recent earthquake in Italy. The company said that Sciubba "has guided Speedimpex since he took over in 2005 leading it to global prominence in providing magazine distribution and fulfillment services to customers and publishers worldwide," adding: "He will be missed, but we remain resolved to maintain and expand Speedimpex' presence as a tribute to him."
Maxim Mulls Another Rate-Base Cut
NY Post: Maxim is "weighing a cut to 600,000 after it had trouble hitting the already reduced 900,000 circulation base, sources close to the situation said. As recently as 2015, Sardar Biglari, the CEO of Maxim parent Biglari Holdings--as well as the monthly’s editor-in-chief--was promising advertisers he would deliver 1.78M copies per issue...That was cut to 900,000 at the start of 2016. In 1H 2016, [Maxim sent] out an average of 53,225 free copies per issue to squeak over the 900,000 base (for an average of 928,753 per AAM). Single-copy sales plunged 15.9%, to an average of 53,708 per issue. Paid subs slipped 54.4%, to 821,820. Maxim’s revenue in 1H slipped 57%, to $5.12M, vs. 1H 2015, regulatory filings show. Its net loss was trimmed 32%, to $6.84M...Meanwhile, Biglari has hired Victoria’s Secret supermodel Alessandra Ambrosio to be Maxim’s 'lifestyle editor.'"
Women's Health Ditching 'Body Shaming' Cover Blurbs
Women's Health is banning outdated language such as "Are you bikini ready?," "bikini body" and "drop two size" from its cover, based on reader feedback. Editor-in-chief Amy Keller Laird says that media should not be complicit in "body shaming" and promoting a certain physical ideal, reports the L.A. Times. "We really want to promote health and wellness, not anxiety and issues.” Laird said Women’s Health is trying to include more “athletic” bodies as well as features on swimsuits that run to higher sizes. Her readers, she said, continue to seek #fitspiration and advice on how to get lean and toned, so aspirational models and skin-baring suits are not going away in her magazine. “The bikini itself is not the problem,” she said, just the notion that you have to look a certain way to qualify for one. The magazine also has launched a podcast to discuss body image and other social issues that affect women’s health. A new meta-analysis of 30 years of body image surveys, slated to be released at the American Psychological Assn. in August, suggests that an obsession with being thin is actually declining, perhaps as a result of greater body diversity in the media, according to study author Bryan Karazsia, associate professor of psychology the College of Wooster in Ohio.
Saveur Launches Wine Club
"The Bonnier-owned food, wine, and travel magazine announced its entry into the membership club game with the launch of "Saveur Selects," a curated, globally-sourced wine club in partnership with California-based winery and importer Terravant Wine Company. For $74.99 per shipment, members will receive four bottles of wine selected by Saveur'seditors, six times per year. Far more than simply an additional revenue stream to bolster the brand's bottom line, however, the wine club is seen as a natural fit for Saveur and an added touchpoint for the brand that aims to position itself as an authority on taste.."it’s really just another way to connect with our audience," Gregory Gatto, VP and publishing director for the Bonnier Lifestyle Group, tells Folio:. "We know from our research that they’re really interested in this'...Saveur's offering is intended to leverage the knowledge of its editors — and Terravant's experts around the globe--who already aim not only to discover, but to tell stories about compelling cuisines and the cultures behind them as part of their day-to-day jobs. A major feature in Saveur's October/November issue, for example, reveals the origins of the world's oldest known winery, a 6,100-year-old site discovered in an Armenian cave in 2007."...
Shape Publisher Exits in Meredith Reorg
NY Post: " Meredith shuffled its upper echelon two weeks ago after Tom Harty, who had run the company’s national media group, was elevated to president and COO. Shape publisher Tim O’Connor was out of a job in the shuffle, replaced by Chris Guilfoyle, who was overseeing Better Homes & Gardens. Andy Amill was hired as publisher of EatingWell. Most of the other changes were internal shuffles, including Carey Witmer, who previously oversaw the parenting magazines and is now EVP and group publisher of the Meredith Food Group, which includes Allrecipes, Rachael Ray Every Day and EatingWell."
Mark McClusky Named SI Group's Digital Editor
WWD: "Time Inc. has hired Mark McClusky from Wired.com to run digital strategy for theSports Illustrated Group. McCusky, who has relocated to New York from San Francisco, will report to Time Inc. SI Group editorial director Chris Stone and Time Inc. digital director Will Lee when he starts his job on Sept. 6. The move to Sports Illustrated is a homecoming for McClusky, who served as a reporter and editor at there. McClusky, who will grab the title of digital editor, will oversee the Web sites of Sports Illustrated, Golf, SI Kids and SI Swimsuit, including oversight of their digital news gathering operations, social and video teams. The editor will also work on deeper collaboration and cross-brand initiatives, including on a daily basis with the FanSided Network, SI Play and SI Group partners, Fox Sports and 120 Sports..."
Opinion: Increasing Newsstand Buyers' Frequency
Newsstand consultant John Morthanos asks editors: "If you have strong selling single copy sales on particular issues, and conversely, consistently poor selling issues on a particular subject, why repeat the editorial of the poor selling issues as the lead story?... Looking at single copy sales of ALL magazines, we can see from distribution reports that issue after issue, basically, the same number of copies go into the same number of stores. Why does one issue sell 45% and another 20% of the distributed copies? Was it a delivery problem? Did a storm close all roads? Did all stores have lousy in store merchandising? When you can build on the editorial with a proven sales history [including repeating topics that sold well in a specific month in the past], then you’ll appeal to the two-issue newsstand subscriber and potentially increase them to three or four." He adds that, with special interest (non-celebrity) magazines, "Sometimes the editors are too close to their subject or writing for themselves and their friends that they might be out of touch with the newsstand subscriber who may be a neophyte to the topic, who has the potential of becoming a regular subscriber (or more frequent newsstand subscriber)." He also offers a case study.
Q&A: Time Inc.'s Content Chief Ready to Take Down Siloes
The primary job of new chief content officer Alan Murray, 61, will be to better orchestrate the efforts of its online and print publications, while paying close attention to digital revenue. His boss, Time Inc. CEO Joe Ripp, has told investors that Murray has been tasked “to grow audiences in every format and on every platform, with particular emphasis on mobile, social and video." Excerpts from a USA Today Q&A with Murray: "We have to figure out opportunities to attack digital markets in different ways where the synergies among the brands exist. For example, can we pull all our health content in one place and create a winning digital product in health? You will see over the course of the next two to three months some very big changes in the way we are organized...I was a little surprised to discover that these brands had all existed pretty much in silos. They didn't do a lot of sharing of best practices and didn’t have many opportunities to learn from each other. In the digital world, they didn't think a lot particularly about how they could work together... We have to prioritize...and really think about the right way to organize this thing. Let's say we’re oversold in food (advertising). We can use our various social feeds in our various websites to point more traffic to food content. Those sorts of things just didn’t happen here before. We’ll try a lot of different things (on video)...I’ve made a challenge to all the editors to change the way we think about what we do, and I've been really impressed with how quickly they’ve picked up the challenge. Our goal is to convince ourselves, the world and the marketplace that it really does make sense for these 24 brands to be in the same company. Because if we don't prove it, then someone may come in and say. 'Let's just break them up and sell them off.'
OTHER NEWS OF NOTE:
Major Retail Players' Prcing War Escalates
MNB cites a Bloomberg report that Walmart's recent efforts to battle the dollar store segment by "using its hefty $10B in free cash flow year to date to cut prices on key traffic-driving items such as laundry detergent and fresh fruit in the locations closest to dollar stores" seem to be working.Both Dollar General and Dollar Tree have reported disappointing quarterly sales numbers in recent days, blaming increased competition, inflation and in one case, "that sadly common retailer affliction, 'unseasonably mild spring weather'."At the same time, Reuters reports that Dollar General "said it was cutting prices on its most popular items such as bread, eggs and milk, intensifying a price war with retail giant Wal-Mart Stores Inc. to win back market share ... Dollar General cut prices by 10 percent on average on about 450 of its best-selling items across 2,200 stores during the quarter."The story notes that "dollar store operators have expanded aggressively in recent years, taking market share from Wal-Mart and other retailers, thanks to their smaller store sizes, improving product assortment and price points starting $1." W-M originally seemed to think that the best way to compete was with small format stores, like the Walmart Express concept. But when that didn't work out as well as it hoped, Walmart closed or sold off those units and refocused its attention on the supercenter and Neighborhood Markets concepts.It isn't just Walmart and the dollar stores that are engaged in the price battle. The Cincinnati Business Courier reports that Kroger has implemented price reductions on 1,000 SKUs in its 120-store Mid-Atlantic region [see item below]. And Bloomberg notes that "German no-frills supermarket Aldi has also been expanding in the U.S. at a faster clip. And with its other German competitor, Lidl, poised to enter the U.S., the race to the bottom is unlikely to abate."Cutting prices to the bone--worsening the deflation that has gripped America's mass merchants lately--doesn't tend to be a winning long-term strategy. It especially hurts retailers that aren't opening new stores, which lets chains make up the difference on volume, at least in the short term."
Kroger Looks to Compete With Wal-Mart's Prices
Cincinnati Business Journal: Kroger cut prices on about 1,000 products in the 120 stores that make up its Mid-Atlantic region. It made the move a couple of months ago, but that change got some attention on Tuesday when industry newsletter the Robin Report published a detailed report about Kroger. The article, written by former Supermarket News editor David Merrefield, highlighted Kroger’s price cuts in comparing Kroger’s prices to those at noted discounter Wal-Mart. “Kroger has been able to come close enough to Walmart’s pricing structure to remain competitive, outperforming any of its industry peers,” Merrefield wrote..."
Amazon Tests 30-Hour Work Week
CS Monitor: Amazon "is set to launch an experimental program consisting of a few teams of workers made up entirely of employees working 30 hours a week, instead of the usual 40 hours expected of a full-time employee. The new program is small, consisting of a few dozen people in a company that employs more than 225,000. But if it is successful, it could provide a new model for Amazon as well as other large companies seeking to become more competitive in a tightening labor market, and to especially attract more mothers. Amazon, of course, already has a large number of part-time workers. What makes this experiment unusual is that every level of the teams, including managers, will be part-time. The Washington Post reports that the part-time workers would only receive 75% of the pay a full-time worker would receive, but they would still receive full benefits..."
Kantar Projects 3.8% Holiday Growth, Including 16% Online Growth
For the holiday season, Kantar is predicting a solid gain of 3.8%, including a 16% increase in online spending and a 2% hike in brick-and-mortar shopping. This forecast presents a small bump from the 3.4% growth in fourth-quarter sales last year. “Lower prices and job growth will stimulate more holiday shopping activity this year,” says Doug Hermanson, its principal economist, in a release announcing the prediction. “On the other hand, falling prices will create a tough environment for topline retail sales growth.” He adds that the distance between e-commerce and in-store sales “will be much wider than recent years.” In fact, the 2% gain for physical stores would actually be lower — 1.9% — if supermarkets and drug chains wee removed from the mix. That online growth, if the prediction holds, will make for online’s best showing since 2011. Hermanson says the gains are likely to be spurred by lower food and fuel prices, even if people’s incomes are slow-growing..."
For Once, Amazon's Taking a Page from Wal-Mart's Playbook
QZ: In a move emulaling Wal-Mart, "Amazon appears to be planning to let US customers order groceries online and pick them up at designated drive-in spots, according to planning documents reviewed by several local news outlets. The e-commerce giant is reportedly testing a “click and collect” model inSunnyvale, California, a little further up the San Francisco peninsula in San Carlos, and in Seattle, Washington...W-M began testing curbside pickup of online grocery orders for the US in Denver in 2013. This time last year, online grocery pickup was available in five US markets; it has since expanded to nearly 400 stores across more than 60 markets. Pickup is same-day, free for customers, and available from 7 am to 11 pm local time..."
Ahold Delhaize Profit Up, Merger Targets on Track
MarketWatch: " Koninklijke Ahold Delhaize NV said Thursday its mega-merger got off to a good start after the newly merged supermarket operators reported solid standalone results in Q2, driven in part by a robust performance in the U.S. The Dutch-Belgian company, which will report combined results as of Q3, said both Ahold and Delhaize enjoyed an improved financial performance in the months before the merger's closure on July 24. "We have started our new chapter as Ahold Delhaize with good momentum, with these two strong sets of pre-merger results," said CEO Dick Boer. The roughly $31B deal has created one of the largest supermarket operators in the U.S., combining Ahold's Stop & Shop Giant chains with Delhaize's Food Lion and Hannaford chains. It would give the grocers new muscle in a time of increasing competition from discounters such as Wal-Mart Stores Inc. and declining food prices..."
Peapod's Growth Slowdown Attributed to Operational Issues
SN: "Operational problems at Peapod’s Chicago warehouse have dragged on Ahold Delhaize’s U.S. online grocery business, executives told investors in its second-quarter earnings call Thursday. Sales growth has fallen from double digits to high single digits, executives said. Dick Boer, president and CEO, said “all our focus is now [on] the teams to resolve that” issue, with the expectation that Peapod growth will return to double digits once fixes have been made.."
Red Apple Rescues Rival D'Agostino Chain
NY Post: "D’Agostino, the struggling 84-year- old independent New York supermarket chain, has found its white knight — rival grocer Red Apple Group. John Catsimatidis’ Red Apple chain, which also owns the Gristedes stores, has set up a revolving credit facility for the cash-strapped D’Agostino operation, the company said on Thursday. Red Apple would also weigh a move to move D’Agostino into a joint venture. “They’ve already got skin in the game, so there’s a good chance our plans will go forward,” D’Agostino Chief Executive Nicholas D’Agostino III said of the joint venture he expects to be formed within a month. “By bringing New York’s two old supermarket families together, we’re hoping two plus two will equal five.” Catsimatidis said he had even grander expectations, saying efficiencies gained in the joint venture would “turn two plus two into six.” Both longstanding chains have been struggling in the Manhattan market as national chains like Whole Foods, Trader Joe’s and Fresh Direct, move in..."
What Wal-Mart's Jet.com Acqusition Means for Retail's Future
TechCrunch: " With the sale of Jet.com, traditional retail significantly moves into the business of online storefronts with global reach and locally-sourced logistics. The move by Walmart follows years of trying to compete with Amazon’s e-commerce success fueled by a fundamental shift in consumer behavior toward on-demand quality. More importantly, Walmart buying Jet.com and Macy’s decision to close 100 stores in order to boost online operations this month does confirm that the next generation of retail will be dominated by online sales and direct-to-consumer logistics companies..."
Amazon Launches Car Research Site
WaPo: "Although Amazon isn’t getting into the business of selling cars, a new section of its website is designed to help people looking for a new ride get more information on the vehicles out there. The Amazon Vehicles section of the massive online retailer went online Thursday morning. Amazon already sells millions of car parts and accessories, but this is the first time it has taken a serious push to feature vehicles on the site. One selling point for Amazon Vehicles, according to the company, will be that customers can leave reviews for cars in much the same way as they can for any other item on the site..."
OTHER NEWS OF NOTE: