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Thursday, October 13, 2016
 MBRNYC / Kickoff Event
Thursday, October 25, 2016
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October 21, 2016

Register Now! MBR CANADA (Formerly PBAA/IPDA Canada)
Tues., Oct. 25, 2016 at The Old Mill, Toronto
Breakfast, Meetings, Speakers, Lunch, Networking, Reception
Program includes Jason Kay, editor, Hockey News;
Jody Mitich, author of "Unflinching: The Making of a Canadian Sniper"
(sponsored by Simon & Schuster);
marketing insights from leading retailers; latest market stats and opportunities
Visit for details, registration

Publishing News

W Reveals 10th Anniversary Cover (With Stars' Knees Missing)
USA Today: " Kendall Jenner and Gigi Hadid went wild for their latest photo shoot. The It-girls, who this year cracked the top five on Forbes' list of top-earning models, recently posed together for W magazine's 10th Anniversary Art Issue. As part of the project, aptly titled 'Placebo Pets,' Jenner and Hadid were transformed into "domesticated humanoid pets" and the result is almost a little too puuuurfect--and by 'perfect,' we mean photoshopped. But hey, they are working those Louis Vuitton Resort 2017 dresses...MediaPost's Erik Sass notes that "ss some astute observers have pointed out, the magazine has Photoshopped [the cover stars'] knees out of existence, giving their legs the appearance of long, sensuous hotdogs, well-moisturized tentacles, or hastily produced mannequins..." In other W news, Modern Media reports on how the magazine is using Snapchat to draw new, young readers. And finally, Samir Husni offers a Q&A with W's publisher Lucy Kriz and editor Stefano Tonchi.
MediaPost (legless cover)
USA Today (cover)
Modern Media (use of Snapchat)
MrMagazine (Q&A)

Barron's to Lay Off Staff Next Week; WSJ Offering News Staff Buyouts
"News Corp's Wall Street Journal on Friday offered all of its news employees the option to take buyouts, according to a memo reviewed by Reuters. 'We are seeking a substantial number of employees to elect this benefit, but we reserve the right to reject a volunteer based on business considerations,' wrote Gerard Baker, the newspaper's editor in chief. Earlier this week, William Lewis, CEO of WSJ parent Dow Jones, announced a three-year plan to cut costs in response to a decline in print advertising. The goal of the review, dubbed WSJ2020, is to modernize the newsroom and improve its mobile and professional information business products, Lewis wrote in a memo Wednesday outlining the plans"...In a related item, Politico reports that Ed Finn, president and editor of Dow Jones magazine Barron's, accidentally leaked the company's intention to lay off some employees next week, when he mistakenly sent an email about the layoffs to all newsroom employees.
MSN (WSJ buyouts)
Politico (Barron's layoffs)

Bonnier, Rodale, TEN Add 65 Pubs To Flipboard
Bonnier, Rodale and TEN are among the publishers that have added a total of 65 new titles to Flipboard, the platform that aggregates news stories, images and videos, and lets users access individual articles from publisher partners on the app. Specific content can also become part of users’ magazines by clicking on a “plus” symbol on individual articles, boosting the story to user’s followers and increasing distribution for the publisher. Last week, Flipboard launched a new advertising product that emphasizes flexibility by combining multiple ad formats, called Storyboard. Earlier this year, Flipboard began making its ad inventory available for real-time buying through an invitation-only private marketplace, as well as introduced its first vertical video ads.
Flipboard release (list of new titles on platform)

Fortune Redesigns Logo
Fishbowl reports that Fortune has a new logo (shown here). The logo on bottom is the magazine’s 10th new look in its 86-year history. The previous edition (top) lasted just six years. In a post about the new look, Fortune creative director Paul Martinez explained that the magazine made the move “To reflect our working thesis, which we outlined in November, that every aspect of business is about to change, creating what we call the ’21st Century Corporation.'” The new logo is “a visual representation of this new entity,” continued Martinez. It is “clean, modern, approachable, and clutter-free.”

Rolling Stone Reporter Admits She Made Mistakes in Rape Story
The Guardian: Sabrina Rubin Erdely, the author of a now-retracted Rolling Stone article about a brutal gang rape at the University of Virginia, "on Thursday acknowledged that she made mistakes while reporting the story of the woman identified only as Jackie...Erdely took the stand in the defamation trial against the magazine over its 2014 story. University administrator Nicole Eramo is seeking $7.8M from the magazine for its portrayal of her in the story. Libby Locke, an attorney for Eramo, quizzed Erdely about her reporting errors, including her decision not contact the Jackie’s friends who went to her aid the night of the alleged assault and failure to raise concerns about changes in Jackie’s account over time. Erdely said that Jackie’s changing story didn’t bother her because “it takes trauma victims time to come forward with all the details"...Locke also criticized Erdely’s failure to interview the friends Jackie said were with her just after the alleged assault. Erdely’s reporting notes contained the full name of one of those friends, but Erdely said she overlooked it..."

Magazine Publishing Veteran Carl Portale Dies at 77
Carl Portale, 77, a longtime publisher of Elle and Harper's Bazaar, died on Oct. 20, after a battle with cancer, in Harrison, NY. Portale entered the industry by launching Snowmobiling magazine with his wife, Carol Rogers Portale, who served as editor. He later launched European Travel & Life, which was eventually sold, and then worked for Good Housekeeping, Town & Country and Mirabella. More recently, he had served as a VP and publishing director at Glam Media. In 1993, he was named publisher of the year by Advertising Age for leading a revival of Harper’s Bazaar with editor in chief Liz Tilberis. In 1997 Italia magazine named him as one of the most influential Italians in the US. Portale was a mentor to the late John F. Kennedy Jr., when JFK Jr. was launching and running George magazine.

Opinion: Newspapers May Have Made 'Colossal Mistake' With Online Push
Politico's Jack Shafer writes that based on a paper written by professors at the University of Texas, "in the mad dash two decades ago to repurpose and extend editorial content onto the Web, editors and publishers [may have] made a colossal business blunder that wasted hundreds of millions of dollars, and possibly should have stuck with the industry's strengths: the print editions where the vast majority of their readers still reside and where the overwhelming majority of advertising and subscription revenue come from. The report found that the online readership of local U.S. newspapers has grown little since 2007. Further, "the financial performance of online newspapers is 'underwhelming,' [the study concludes], with total newspaper industry digital advertising revenue increasing from $3B to only $3.5B from 2010 to 2014. Yes, total newspaper print revenues have plunged from $22.8B to $16.4B over the same period, but they still represent 82% of total newspaper revenue. Only the New York Times and the Wall Street Journal have succeeded in attracting a mass audience willing to pay for paywalled online editions, but they are national, not local newspapers..."


Retail News

How Bad Can Whole Foods' Legacy Business Get?
SN: "When it comes to Whole Foods Market’s legacy business, these days it seems to be all bad news. Profit and comparable store sales have fallen as conventional retailers like Kroger and Costco have dramatically expanded natural and organic product offerings, obviating the need for shoppers to visit a specialty store like Whole Foods. In July, Whole Foods announced year-to-date net income fell 12.5%, while sales rose 2.3% and comps were down 2.4%. On top of that, the retailer has failed to shake the “Whole Paycheck” perception, and has suffered from a series of image issues, including allegations of overcharging in New York stores. Though the retailer’s new small format concept 365 by Whole Foods Market has so far impressed industry observers, it has also sparked fears of cannibalization, with prices at 365 stores coming in 15% to 20% lower than at legacy stores. Industry analysts at SN’s 21st Annual Financial Analysts Roundtable last month said Whole Foods’ falling comps, more price competition, labor cuts in stores and an overly aggressive store growth plan could spell disaster if the retailer can’t turn things around. “I mean they’re just not on a sustainable path. This company is going to have to be restructured unless comps turn positive, but there’s no catalyst for it,” said Scott Mushkin, senior retail/staples analyst, Wolfe Research..." And speaking of bad news, SN separately reports that a Whole Foods in Detroit has been linked to two cases of hepatitis A.
Supermarket News (financials, paid sub req.)
Supermarket News (hepatitus A link)

The Fresh Market Remakes Image, Offering
SN: "In a push to turn around disappointing sales and connect with value-oriented customers, The Fresh Market announced a new logo, lowered prices and expanded product offerings, which will debut Oct. 26 at three stores in the Triad region of North Carolina. The move marks the first major initiative for the struggling retailer since Apollo Global Management acquired The Fresh Market in March. The retailer said it plans to expand the new look and offerings to 13 more stores in the Charlotte and Raleigh/Durham, N.C. markets on Nov. 30. The remaining stores will be refreshed in waves through early 2018. The biggest changes at the three initial stores — two in Greensboro, where the retailer is headquartered, and one in Winston-Salem--include lowering prices on hundreds of items, doubling the number of aisles in store, and adding 1,300 everyday grocery products..."

Ending Tobacco Sales Made CVS (and the U.S.) Healthier
Adweek: Two-and-a-half years after dropping tobacco products from its stores, CVS Health has helped drop tobacco sales by one percent across all retailers and proved its purpose of "helping people on their path to better health," CMO Norman de Greve told attendees, while speaking at the Masters of Marketing Conference. Plus, 500,000 consumers visited the section of the company's site devoted to quitting smoking and 260,000 people sought help from counselors at CVS. The move also scored 100 million media impressions for CVS Health and revamped the way people see the brand. In 2015, 40 percent more influencers saw the brand as impactful in improving health, versus 2014. "Selling cigarettes and antibiotics in the same store is just wrong...we're still the only pharmacy not selling tobacco," said de Greve. "Rite Aid, it's your move."

Analysts Mull Possibility Kroger Might Buy Divested Drug Stores
SN: "The industry is still awaiting the fate of hundreds of Walgreens and Rite Aid stores that need to be sold as a condition of the drugstore megadeal, but analysts who gathered atSN’s offices last month were intrigued at speculation that Kroger could be a buyer. “It does seem like Kroger wants to get bigger in that business,” said Scott Mushkin, managing director, senior retail/staples analyst, Wolfe Research. “They just bought their second specialty pharmacy operator. I think they had standalone drug stores a long, long time ago, so it would be interesting to get back into the business, but I think there’s something to that rumor.” In July, Kroger announced it had acquired Modern HC Holdings and merged it with its Axium Pharmacy business to create a combined specialty pharmacy that operates as a wholly-owned subsidiary. The move expanded Kroger’s specialty pharmacy medications and services, creating a one-stop pharmacy shop for its customers. Ajay Jain, a Pivotal Research analyst, noted Kroger has exhibited a recent willingness to look at such growth vehicles, and said the forced divestitures could create a buyer’s market. “You’ve got a motivated seller and you could get it for below market multiples,” Jain said. “I think that would be an interesting angle.” But earlier this week, reports about Kroger passing on divested stores surfaced. They cited sources who said that the Federal Trade Commission disapproved of a Kroger plan to purchase some Rite Aid stores, close them and move these operations within existing Kroger stores. When asked about Kroger’s plans, a company spokesman said he could not comment..."
Supermarket News (paid sub req.)

Harveys Switches Loyalty Program Behind Plenti
SN: "Southeastern Grocers' Harveys chain has relaunched its loyalty program behind Plenti rewards, becoming the first supermarket chain to join the nascent coalition of retailers and services that share collection and redemption of shopper loyalty points. The program, which went live at all Harveys stores Wednesday, replaces the chain's previous loyalty rewards program, FuelPerks, which offered points for grocery shopping redeemable for gasoline discounts, officials of Southeastern Grocers told SN..."

Amazon #1 'Loyalty Leader'
'MNB: "Brand Keys is out with its annual list of Loyalty Leaders - companies that work to create persistent and sustainable consumer engagement. After looking at 635 brands in 72 categories, it concluded that Amazon was number one, followed by Zappos, Ralph Lauren, Sephora, Trader Joe’s, Sam’s Club, Old Navy, Victoria’s Secret, eBay, and Whole Foods. 'Ever-increasing consumer expectations, Brand Keys says, 'force brands to work a lot harder to create emotional engagement--the ability for a brand to be seen as meeting consumers’ expectations for their Ideal Retailer. Today emotional engagement is the predictive, real-world yardstick for loyalty, market share, and profitability. Want to know what consumers are going to do and where they’re gong to shop? Measure real loyalty and engagement.'"

More on Food Deflation
USA Today: "Average supermarket prices fell 2.2% in September from a year ago, the most since late 2009, and they’ve been down on an annual basis for 10 straight months, the longest such streak since 1959-60, Labor Department figures this week showed. But...falling prices at the checkout are spreading hardship across the nation’s farm belt and hammering the earnings of grocery chains. 'It’s a very positive thing for the middle-class and low-income households,' says Chris Christopher, an economist at IHS Global insight. “If they can save a bit here or there, they can spend it elsewhere. That’s what we need to keep the economy growing.'... With low prices likely to persist at least into early next year, some pig farmers are expected to reduce their herds, says Steve Meyer, economist at EMI Analytics. But most crop growers won’t retrench because they’re paying rent on land they’re loath to relinquish, Bertels says. 'For a lot of farmers, the options for cutting back are severely limited,' says Nathan Kauffman, agricultural economist at the Federal Reserve Bank of Kansas City. Supermarkets, which operate on thin margins, are also getting squeezed. Supervalu said this week that second-quarter revenue fell 4.8% as prices tumbled 4% to 6.5% at its two chains. And citing food deflation, Kroger last month lowered its earnings outlook and said it’s cutting capital investments by $500 million in 2016 and 2017."


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