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brand challenges

Walmart's Woes Outrun Its Capabilities; Are Smaller Stores the Answer?

Posted by Dale Buss on February 20, 2014 03:53 PM

It seems the proud days of Walmart are now behind the US brand that is looking increasingly lost in a quickly evolving global market. 

The world's largest retailer on Thursday reported a meager net-sales increase of just 1.6 percent and a 3 percent drop in operating income for 2013 as Walmart coped with struggling consumers in America and elsewhere, a drop in US government support for many in its low-income customer base, and even the scourge of bad weather that has hit many US retailers over the last few months.

Worse yet, Walmart comp-store sales actually declined by 0.6 percent, an incredible blow to a brand that achieved the top of the mass-merchandising mountain by being able to create a powerful price-based loyalty among its customers that had survived every impediment before 2013.Continue reading...

corporate citizenship

Gap Looks to "Do More" with Wage Hike, But Will Walmart Follow?

Posted by Mark J. Miller on February 20, 2014 01:37 PM

During President Obama's State of the Union address last month, he asked businesses across the US to raise their minimum wage to $10 an hour, even if Congress wasn't going to force minimum wage above its current $7.25 rate, though it plans to pay its own workers $10.10 starting next year. 

It seems at least one major US company was listening. Gap Inc. announced that it will voluntarily increase its minimum wage to $10 per hour in June of 2015 after boosting its pay rate to $9 per hour this year, Reuters reports. The increase will benefit about 65,000 workers across the company's Gap, Banana Republic and Old Navy brands.

Harking back to the directive from founder Don Fisher to "do more than sell clothes," the company said that "after many months of consideration, we've made a business decision that's right for our brands, good for our people and beneficial to our customers."

"I applaud Gap for announcing that they intend to raise wages for their employees beginning this year," President Obama said, according to Reuters.

It remains to be seen if Walmart, the largest private employer in America, will follow. Numerous protests demanding that Walmart raise its minimum wage have been ongoing over the last year, as the company made headlines for refusing a pay increase in Washington, D.C. and other pay-related incidents around the holidays.Continue reading...

brand news

In the News: Facebook, Sbarro, Walmart and more

Posted by Dale Buss on February 20, 2014 09:20 AM

In the News

Facebook sees growth anxieties drive WhatsApp purchase.

Sbarro closes 155 company-owned units.

Walmart offers weak forecast and plans to accelerate rollout of small stores.

Aereo suffers a defeat in court.

Audi gives TT Roadster a fresh look.

Budweiser unveils World Cup teaser.

ConAgra seeks to revitalize Healthy Choice brand.

Fiat gives buyers an iconic track experience.

Ford splits with TV pitchman Mike Rowe.

FCC plans to overhaul rules to rescue net neutrality. 

Gap announces voluntary minimum wage boost.Continue reading...

corporate citizenship

Burberry Bows to Greenpeace Pressure to Go Toxin-Free

Posted by Sheila Shayon on January 31, 2014 01:40 PM

When a research study from Greenpeace turned up hazardous chemicals, or "Little Monsters" as they put it, in children's clothing and shoes from major brands including Disney, Burberry, Adidas, Gap and others, the environmental activists turned up the pressure by urging consumers lobby the brands to clean up their act as part of its bigger #Detox campaign.

This week, Greenpeace scored a victory when Burberry agreed to detox its clothing by Jan. 1, 2020. Initially, its corporate back up against the wall, Burberry balked at the group's allegation that a purple metallic shirt contained hazardous chemicals. The shirt in question, made in Tunisia and worn by Romeo Beckham (aka David & Victoria's son) in a June 2013 campaign, contained a high level of nonylphenol ethoxylates (NPEs), manmade chemicals used in detergents, which degrade to nonylphenols (NP), both toxic and hormonally disruptive.

"All Burberry products are safe and fully adhere to international environmental and safety standards," the luxury apparel brand responded in a statement. "We have an active programme dedicated to reducing the environmental impact of our supply chain, working in collaboration with our suppliers and NGOs. Greenpeace is aware of our work, which includes the commitment to eliminate from our supply chain the release of chemicals that have an environmental impact."Continue reading...

e-commerce

Walmart Goes Head to Head with Amazon for E-Commerce Dominance

Posted by Barry Silverstein on January 30, 2014 04:54 PM

The world's largest retailer has a few tricks up its sleeve that it hopes will catapult it ahead of arch-rival Amazon in the hotly contested e-commerce space.

In Denver, Co., Walmart To Go, the retailer's on-demand shopping service, allows shoppers to order just about any merchandise they want online, including groceries, and have it delivered to their homes, just like Amazon. But now, Walmart To Go not only includes home delivery of grocery items—it also has a pick-up option. That means Denver consumers can order their groceries online, park in a designated space near their closest store, and pick up their groceries without ever stepping into the store.

Walmart has tested home delivery of groceries in San Francisco and San Jose, Calif. since 2011, while Amazon has been testing "Amazon Fresh," a grocery home delivery service, in select cities with plans for more in 2014.

With in-store pick-up, Walmart is allowing consumers to exercise more options. "It's all about choice," Ravi Jariwala, Director of Public Relations at Walmart, told TechCrunch. "At this point, we're really trying to assess what our customers are gravitating toward, and the good news is that I don't think this is an either/or [situation]."Continue reading...

brand news

In the News: Microsoft, Google, Apple and more

Posted by Dale Buss on January 27, 2014 09:14 AM

In the News

Microsoft posts record sales as Ballmer prepares exit; competes with Amazon on cloud storage prices; admits to Syrian Electric Army email breach; and releases global study on power of technology.

Google pushes back against data localization, faces protest in San Francisco, buys artificial intelligence startup DeepMind and announces global patent agreement with Samsung.

Apple reportedly eyes mobile payments service, as hopes are high for Q1 earnings release on Monday.

AIG says it’s on offense as corp rep restored.

AT&T quashes rumors of Vodafone bid.

Accenture tries to grab STEM graduates early.

Ally Financial readies pre-IPO roadshow.Continue reading...

corporate citizenship

Cambodian Garment Workers, Brands Mobilize Efforts to Improve Wages, Safety

Posted by Sheila Shayon on January 21, 2014 06:46 PM

It was only a matter of time until the life-threatening issues surrounding worker safety and the garment industry spread to Cambodia, where just a few months ago a factory disaster claimed several lives.

The residual effects of recent tragedies in Bangladesh, the second-largest garment manufacturer behind China that saw over 100 killed in a 2012 factory fire and over 1,200 workers perish in the Rana Plaza collapse, have spread to other global economies, igniting protests over safety and fair wages. 

Protests erupted in Phnom Penh, Cambodia on Dec. 24 after the Ministry of Labor set the garment sector’s 2014 minimum wage at $95 per month, rather than the $160 unions wanted. When security forces opened fire Jan. 3 on a group of demonstrators, four people were killed, 37 injured, and another 23 detained in a prison for four hours.

Now, 30 global brands and several unions have joined the fight, signing a letter to Prime Minister Hun Sen asking the Cambodian government to “address the rights of 23 people detained since deadly garment worker demonstrations on January 2 and 3 and the violation of citizens’ freedom of association," according to the Phnom Penh Post. Government officials said they acted in the public's interest and to protect the workers.Continue reading...

health matters

Adidas, Gap Speak Out Against Claims That Clothing is Tainted with Chemicals

Posted by Sheila Shayon on January 20, 2014 02:38 PM

Adidas, Gap, Disney and Burberry are rebutting claims made by Greenpeace that chemical levels in their children's apparel products exceeded legal limits. 

The major brands have questioned the scientific basis of the report, called "A Little Story About the Monsters In Your Closet," which was published by Greenpeace East Asia after the environmental group reportedly purchased and tested dozens of articles of kids' clothing from major brands. According to the group's claims, some of the apparel contained higher chemical levels than those found in adult clothing, citing a high risk since young children often chew on their clothes. 

According to the South China Morning Post, Gap refuted the group's claims, saying the chemical levels were barely detectable. "For example, the allowable amount of phthalates for childcare articles and toys is 0.1 percent and the maximum concentration of phthalates they found in Gap clothing was 0.004 percent of the garment," the company said. Adidas said the report was "selective" and the company will seek third-party verification.Continue reading...

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