Tippets by Taps - Issue #111
Happy Thanksgiving! A quick note: On the recommendation of a few vocal subscribers of the newsletter I’ve given the weekly a name - Tippets by Taps. It’s a work in progress, but I’m going with it for now.
This week we look at grocery store-gym combos, the decline in Black Friday’s relevance, why child care is so expensive and more. Enjoy!
Groceries and glutes: Supermarkets add boutique gyms and yoga classes
It’s the week of Thanksgiving. You’ve eaten your body weight in turkey, stuffing, and pie. You’re now wondering exactly what combination of intermittent fasting, elliptical and light weightlifting will help get you back to ‘holidays normal’ so you can fit not-so-snugly into that holiday sweater you bought for the party in a few weeks. And you definitely want some more pie. Well, it looks like grocery stores can now give you a slice with a side of cardio.
Supermarkets are trying to entice shoppers with more than just food…As competition in the grocery industry stiffens, these stores hope to attract time-strapped shoppers by creating convenient experiences that shoppers can’t replicate online. Grocery stores see an opening in the surging fitness industry, one of the rare business areas that has not been cannibalized by Amazon.
Experts say grocers have also stepped up their focus on catering to customers’ health demands in recent years. Supermarkets are adding juice bars and health clinics and bringing dieticians into stores.
Hy-Vee and OrangeTheory are testing out studios attached to a full-size Hy-Vee supermarket in Shakopee, Minnesota, as well as a “HealthMarket,” a slimmed-down Hy-Vee store. This 15,000-square-foot concept store in West Des Moines, Iowa — around one-sixth the size of a traditional Hy-Vee — has a pharmacy, health clinic, and hearing aid and sports nutrition areas. It also offers nitro coffee, kombucha and Bevi-infused water.
The move makes sense for both grocers and fitness chains. As much as grocery delivery has been hyped up, most people still shop for groceries the old fashioned way with only 19% of the population having ordered groceries online. Being able to get a workout in pre-grocery run is already the case for a lot of folks. Getting the workout sponsored by the grocery store as part of a member rewards program? Why not.
Weeks after ‘Black Friday’ sales started, it’s finally here. And it’s anticlimactic
Black Friday. Every shoppers dream. A day when discounts fall from the heavens and, in the words of my brother in law, “Things are so cheap they might as well be free!” A great day to burn off some of the Thanksgiving calories (assuming you didn’t go to a grocery with a gym) while participating in the year’s most eagerly awaited commerce day. Or is it?
This year’s Black Friday sales began in October, long before most Americans had even begun thinking about Thanksgiving. In the weeks since, retailers have pushed out nonstop “HoliDeals” and “Early Access” promotions aimed at getting consumers to spend early and often. A number of factors, including looming tariffs, winter storms and a shorter-than-usual holiday shopping season, have kept retailers on edge during what is typically their most lucrative period of the year. Many are banking that the time-release roll outs of promotions and special offers will keep customers hooked.
But many shoppers now view Black Friday as just another day of sales. When they do buy, they’re increasingly doing so online: This year, for the first time, most U.S. consumers say they will do the bulk of their holiday shopping on computers and mobile devices, according to professional services firm PricewaterhouseCoopers.
I ended up doing all my Black Friday shopping from the comfort of a villa in Cabo where I happen to be spending Thanksgiving this year. Black Friday deals came, I knew what I wanted (a bunch of Sonos stuff that was all 20% off which is exactly what I was waiting for) and boom, that was it. The game of “discount chicken” between consumers and retailers has been going on for years. However, unlike Singles Day in China which is gaining momentum, the beginning of the end of Black Friday may have now arrived.
Art of a deal: how LVMH paid up for Tiffany
LVMH, luxury retailer and owner of brands including Louis Vuitton, Hermes, Dom Pérignon and Sephora has a new jewel in their crown: Tiffany’s. The French multinational paid $16.6 billion for the American icon.
The acquisition of Tiffany will catapult LVMH to the top of the rankings for market share in branded jewellery, one of the best-performing luxury categories in 2018, which Bain consultants predicts will grow a further 7 per cent this year. By adding Tiffany to its stable of brands, LVMH will more than double its market share in jewellery to 18.4 per cent, surging ahead of Johann Rupert’s Richemont, at 14.8 per cent, according to Bloomberg Intelligence. Until now Richemont, owner of Cartier and Van Cleef & Arpels, has long dominated this part of the industry.
LVMH will seek to use the approach that it applied to Bulgari. Since it bought Bulgari for $5.2bn in 2011, LVMH has invested in the stores to boost the sales density; focused the product ranges, ramped up marketing and communications, and elevated the brand to focus on high-end jewellery. Under LVMH’s ownership, sales have doubled and profits have increased fivefold.
The interesting thing I found in this piece is LMVH’s CEO Bernard Arnault felt it necessary to tip off the President about the deal.
At the opening of a Louis Vuitton leather factory in Texas last month, President Donald Trump was given a hint about an upcoming deal that would be the luxury sector’s biggest ever. “I told the president I would buy something significant in the US, but I didn’t tell him the name,” said Bernard Arnault…Only two days before the ribbon-cutting ceremony, where the guest appearance by Mr Trump caused controversy for LVMH, Mr Arnault had sent a lieutenant to New York to approach Tiffany.
The move certainly makes sense for the luxury behemoth. It adds a globally recognizable brand to their arsenal and if they can execute their playbook, it should be quite a profitable. That said, the premium over the current market cap is quite high - $16.6bn is a lot of little blue boxes. However, if it helps curry favor with Mr. Trump perhaps the price tag becomes more palatable.
Why Child Care Is So Expensive
Child care is a topic of daily discussion in my house. Since my son was born my wife and I have been delicately navigating the complex and muddy waters of his care, trying to figure out the best solution for our family. We often say one of the best decisions we’ve made for our son was meeting a nanny who truly loves and cares for him. Mind you, finding her was by no means due to a diligent process that yielded many options. Finding our nanny was a combination of good luck, active listserv scouting and some fortuitous timing. Finding childcare in the US for infants and toddlers is harder than it should be. For a new parent it is often a harrowing experience. There are a plethora of options - one parent stays home, day care, nanny, grandparents, au pair et. al - each with their pros and cons, fears of the worst persisting in the back of your mind. The fact that the first few years seem to be the most important ones make the decision around care seem all the more daunting.
Neuroscientists and psychologists have established that the first five years of a child’s life are crucial for the development of logic and language skills. Early education has profound effects on both these cognitive skills and “noncognitive” skills, such as grit, teamwork, and emotional health. But these academic findings haven’t translated to policy, at least not in the U.S.
During the early months of our son’s life, the task of finding care felt too daunting to tackle alone. Why is it so hard in the US to figure out quality child care? The fact that one needs to get on a waitlist for daycares in San Francisco 6 months before the child is born makes no sense to me. I even kicked around the idea about starting a company in the space with a friend of mine, Bright Horizons 2.0 or figuring out a way to get employers to pay for child care as a benefit, before coming to my senses.
There is a deep disconnect in the way the U.S. conceives of its obligation to children. Most Americans accept—even demand—the public subsidy of education from the moment kids turn 5 and enter kindergarten to the day they graduate from a state university or community college. But from birth to the fifth birthday, children are on their own—or, more precisely, their parents are. This arrangement is plainly weird: Parents must bear the highest burdens of child-rearing when they are younger, typically poorer, and less established in their career.
There needs to be a better way to solve child care in the US. How remains to be seen.
I will say that I wish we could get voters and politicians as fired up about free preschool as free college; it seems like the more pressing need to me.
11:17 AM - 29 Nov 2019
Bengaluru police plan to curb traffic violations: 200 mannequins that ‘look like cops’
Bangalore has a traffic problem. City police seem to have a solution. That answer? Life sized mannequins that look like cops.
In a unique initiative to curb traffic violations, the Bengaluru Traffic police have installed life-size mannequins at main junctions all over the city. Cops believe the around 200 life-size mannequins will deter people from breaking traffic rules, such as jumping signal, speeding and not wearing helmets.
Right. These are going to help traffic.
Quote I’m thinking about: “In the end, enjoying life’s experiences is the only rational thing to do. You’re sitting on a planet spinning around in the middle of absolutely nowhere. Go ahead, take a look at reality. You’re floating in empty space in a universe that goes on forever. If you have to be here, at least be happy and enjoy the experience. You’re going to die anyway. Things are going to happen anyway. Why shouldn’t you be happy? You gain nothing by being bothered by life’s events. It doesn’t change the world; you just suffer. There’s always going to be something that can bother you, if you let it.” - Michael Singer