MARKETING/SOCIAL MEDIA

Caribou Coffee launches new loyalty program

BY Dan Berthiaume

Minneapolis – Caribou Coffee has launched its new loyalty program, Caribou Perks. Customers can register by text or online.

All Caribou Perks rewards will be available for use for seven days from the date that they are first received. Customers can view their rewards by signing into their online accounts. If customers are currently opted into the company’s email or text communication, they will receive a notification when they have earned a reward and those rewards will be waiting for them at the register. Those who join the program and complete all the optional questions in their online profile will receive a free medium beverage of their choice

"After a successful pilot for Caribou Perks at select Caribou Coffee locations, we are excited to announce the full rollout of the new loyalty program," said Mike Tattersfield, president and CEO of Caribou Coffee. "Our guests are extremely loyal and passionate about our product offerings, and so we are thrilled to be able to reward them for simply being our fans. We believe this program will enhance the guest experience and is the perfect complement to our premium menu items and warm coffeehouse environment."

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FINANCE

Men’s Wearhouse makes $1.6 billion hostile offer for Jos. A. Bank

BY Dan Berthiaume

Fremont, Calif. – The latest chapter in the continuing rivalry saga of The Men’s Wearhouse and Jos. A. Bank Clothiers, Inc. has opened with Men’s Wearhouse making a hostile cash tender offer of $57.50 per share for Jos. A. Bank. The offer, which expires on March 28, 2014, is worth about $1.6 billion.

Men’s Wearhouse also intends to nominate two independent director candidates for election to Jos. A. Bank’s board of directors at its 2014 annual meeting. The nominees are John D. Bowlin, president and CEO of Miller Brewing Company, and who has held senior executive positions at Kraft Foods North America, Kraft Foods International, Inc., Oscar Mayer Food Corporation and General Foods USA; and Arthur E. Reiner, who has previously served in various leadership positions with the Macy’s organization.

In November 2013, Men’s Wearhouse made an unsolicited bid of approximately $1.54 billion, or $55 per share, for Jos. A. Bank. This offer followed an unsolicited $2.3 billion bid Jos. A. Bank made in early October for Men’s Wearhouse.

"We believe that our $57.50 per share proposal to acquire Jos. A. Bank is compelling and provides substantial value and immediate liquidity to Jos. A. Bank shareholders,” said Doug Ewert, president and CEO of Men’s Wearhouse. “Although we have made clear our strong preference to work collaboratively with Jos. A. Bank to realize the benefits of this transaction, we are committed to this combination and, accordingly, we are taking our offer directly to shareholders."

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News

Overstock to appeal court ruling on comparison price advertising

BY CSA STAFF

Overstock.com is starting 2014 with plans to appeal the tentative ruling of a California trial court prohibiting it from comparison price advertising unless done in conformity with new court-mandated practices which, according to the online retailer, diverge widely from industry standards.

"Respectfully, I believe this ruling is unjust," said president Stormy Simon, "and I know, because since 2008 I have been an integral part of the process by which we log, verify and advertise ‘compare-at’ prices. I am aware of the lengths we have gone to get this right on the millions of products that flow through our website. We will follow the ruling, while noting that the effects on our current practices will be small because, as we are the gold standard, we are already fanatic about getting this right. However, if fairly enforced, this ruling will force other retailers to change their processes dramatically, which makes one wonder why we are the ones who were targeted. We are an honest company committed to bringing justice to all our customers and suppliers, and that’s a promise. If this tentative ruling becomes final, we will file an appeal as soon as possible."

According to chairman and CEO Dr. Patrick Byrne, the ruling puts smaller suppliers at a disadvantage versus the big players.

“By way of extraordinary example,” explained Byrne, “His Honor’s reasoning disproportionately and greatly harms our Worldstock store, where we are providing much needed market access to global artisans, and our Main Street Revolution store, which provides similar market access to small domestic suppliers. The rules His Honor has created are highly impractical for these categories — unlike, for example, our sales of brand-name televisions, which can easily be made to conform with Judge Carvill’s ruling. In November of this year Worldstock surpassed the $100 million mark in payments made to our artisan suppliers, we have attempted to run that division at 0% profit, and where there has been a profit we have used it to build 26 schools educating 6,000 kids, mostly female, across Africa and Central Asia: That is the department that is disproportionately harmed by Judge Carvill’s reasoning. When we go to Nepal and buy some Tibetan singing bowls from an NGO which serves women-at-risk, bring them home, and sell them with the tiniest markup possible, it can be really, really hard to say what the precise compare-at price is — though as an organization we have bent over backwards to be ethical, and have brought such goods to US markets at prices well below anyone else. Under Judge Carvill’s reasoning it becomes highly impractical to market these unique goods in a way that truly reflects the extraordinary values they represent."

Byrne added that the company is not only the gold standard in retail price comparisons but also has been for many years. “We verify each comparison price we use,” he said, “and thoroughly disclose the manner in which we do so. Judge Carvill’s decision is a fine example of the principle, ‘No good deed goes unpunished.’"

The court imposed a civil penalty on the internet retailer for each day it used price comparisons that were not in accordance with new practices the court outlined. From March 2006 to September 2008, the court imposed a penalty of $3,500 per day and from September 2008 through September 2013, $2,000 per day, amounting to $6,819,000 in total. The court also allowed the people to apply for payment of such fees and costs as are allowed by law. The company will appeal both the injunction and the amount of the penalty.

The court did not order restitution, which the company insists is consistent with its contention that no harm was shown and that it is an online low-price leader.

Among other restrictions, the court’s ruling would require more elaborate price comparison disclosures on individual product website pages, depending on the type of comparison made. Assuming that other retailers will have to follow the same rules as Overstock.com, traditional retail stores will have to make lengthy disclosures on paper price tags disclosing their methods of price comparisons. The ruling also could prohibit a retailer from using common reference terms like "compare," without going through a prohibitively difficult and often impossible validation process.

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