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The most beloved brands are…

BY Deena M. Amato-McCoy

Eight retailers ranked among the top 100 most loved global brands, but only three cracked the top 10.

Amazon, Apple and Disney are the only three retailers that ranked among the 10 most loved global brands, according to the fourth annual “NetBase Brand Passion Report: Top 100 Global Brand Love List.” The study is based on brand conversations across the social web, including Twitter, Facebook, Instagram, Tumblr, and millions of other sources between May 2017 and May 2018. Brands evaluated include social media, technology, consumer goods, automotive, food and beverage and telecommunications.

According to data, Amazon claimed the No. 4 spot, followed by Apple (sixth) and Disney (seventh). Drilling down further, Apple also ranked as the most popular technology brand, along with Google (5).

Target (17) and Ikea (46) were named the most popular retail brands. Louis Vuitton (33) and Nikon were recognized as the most popular consumer goods brands.

McDonald’s (18) and Starbucks (20) took the honor of top food and beverage brands. McDonald’s only narrowly beat Starbucks as the most loved food and beverage brand, accounting for 22% of all mentions for food and beverage brands. Fries and all-day breakfast are among the most discussed items.

While Burger King trailed its competitors at No. 59, the brand did move up 28 spots from 2017. This movement earned the company a place among the five companies that showed the greatest change, according to the study.

“Brands that know how their customers feel can cultivate strong relationships to set a foundation for future brand growth. This insight is invaluable as the more passion for the brand, the less the consumer relies on price as the deciding factor,” they study revealed.

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Channeling Millennials: How to capture America’s largest spending demographic

BY Erika Donigan

We all know that Millennials have been one of 2018’s largest areas of focus. But who are they? How do they shop? What do they buy? As a Millennial myself, I know that we can be complex and almost hypocritical at times with our shopping behavior. We spend our hard-earned money on avocado toast, but we also rent our living space instead of owning it; we shop a high-low strategy, etc.

But as the largest shopper segment, it is critical that retailers adapt their strategies to meet Millennials’ needs, rather than expecting us to change our shopping behavior to meet theirs. In order to adapt, retailers must begin to understand who we are as individuals so they can begin to understand who we are as shoppers.

What retailers need to understand is most Millennials are just not retailer loyal. What we are, however, is brand loyal. Most of us have our favorite almond butter or type of ice cream that we just cannot live without, and we are willing to go to more than one place to ensure that we get what we want. And this doesn’t just hold true for grocery. Beauty is another prime example of a sector of business where Millennials are extremely loyal.

The truth is Millennials are about as complex of shoppers as they get, and if retailers can begin to understand us, then they will have tapped into one of the most powerful spending generations ever!

The Winning Formula
So how exactly do retailers win over this elusive set of shoppers? Is it price? Assortment? Promotions? Well, the answer is: all of the above.

The fact is Millennials want it all. We live in an age where we work outside the hours of 9 to 5, try to have an active lifestyle (which means hitting the gym as often as we can), maintain a jammed packed social life (from brunches to barre class), and have at least a little me time (hello, Netflix!). So when it comes to spending on items for ourselves, we crave an experience, with 72% of Millennials choosing an experience over a material item.

So retailers must transform their stores into the experience Millennials want. Instead of the typical grocery store, we want a place where we can buy fresh produce as well as wine and artisanal cheese. We seek a destination that allows us to make an outing out of an otherwise mundane task. Wandering the store aisles with a wine or beer in hand allows us to sip as we shop, which not only makes us happy, but keeps us in-store longer and will likely inspire a few extra items in our baskets.

Harnessing the Data
Retailers must also have the ability to curate assortments that speak to our needs. Digital-native Millennials, communicate, shop, and do just about everything online, which, in turn, creates a mass amount of data that is incredibly valuable for retailers.

Traditional brick-and-mortar retailers face the threat of digital giants like Amazon and other online pure plays that have endless online aisles for us to shop from the comfort of our couch and promise free two day shipping on almost any item. So to entice Millennials into the store, brick-and-mortar retailers need to optimize their assortments to speak to our needs to maintain store traffic and sales. Luckily, we provide all the breadcrumbs they need with our data. If a retailer can follow this path and have the right selection for the right customer and this is key — at the right time, then they may have a new millennial convert on their hands!

Playing Price is Right
So we know that assortment is critical, but what about price? Well, considering that our generation is the most debt-burdened in history, price does come into play. But not in the same way it may have for our parents.

Millennials are willing to pay for what we want (think $70 anti-aging skincare creams and $20 bottles of wine), but we do not want to pay high prices for the other necessities of life (such as private label toilet paper). If a retailer can grasp this and begin to price their products accordingly, then it can begin to build the Millennial shopper’s baskets.

The best way for a retailer to gather this type of information on how to price? Utilize the data on hand. Determine which products Millennials deem splurge-worthy and those that are simply must-haves. Follow those all-knowing breadcrumbs that we leave behind.

Getting Personal
This leads us to the elusive promotions bucket, that proverbial Pandora’s box of issues. Do mass promotions work? What about personalized? Do Millennials even use direct mail? Or are we all digital? How do retailers reach their customers, but, more importantly, us millennial shoppers?

To begin, retailers should look into the numbers. Millennials are much more comfortable sharing data than previous generations. Given this, and our complete obsession with efficiency and saving time, it is imperative that retailers use the data available to them to speak to us in a way that breaks through our daily social media clutter. This does not just mean offers but all content.

Millennials have been trained over the years to expect a barrage of promotional emails, most of which we don’t open and probably send straight to spam. Where retailers can win is in retargeting. Make it easy for us. If I was online perusing my favorite athleisure store, a promoted Instagram post “reminding” me of what I looked at may just be the ticket to have me actually hit the purchase button. This is where retailers and brands will win. Understand your customer — not just their past purchase behavior — but their entire purchasing lifecycle, and react relevantly. Those who do will get very loyal customers in return — just ask my local Bluemercury.

Millennials have already surpassed Baby Boomers as the generation with the most disposable income. We also are delaying traditional “milestones,” such as buying homes and having babies, until later in life and, thus, have different shopping behaviors than previous generations. This shift in shopping and lifestyle has left retailers scratching their heads on how to reach us. The answer is simple: Retailers still need to focus on their core elements: assortment, price, and promotion but must use the data available to them to create Millennial-centric shopping experiences. Those who will win are those who are willing to take a step back and look at what drives us and what motivates us to spend. When done well, retailers will not only gain sales but loyal, avid shoppers, too.

Erika Donigan is North American marketing manager at emnos.

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Regulatory Wrap-Up: Insider’s weekly recap of retail-related legislation – June 25

BY CSA Staff

Wages

Massachusetts – The legislature passed a sweeping bill this week designed to keep an array of issues, notably paid leave and minimum wage mandates, from appearing on the Nov. ballot. The so-called grand bargain is intended to satisfy labor activists and it appears to have been effective as it relates to paid leave. However, Raise Up Massachusetts has not yet agreed to withdraw its $15/hr minimum wage increase from the ballot. The compromise included a slightly watered down $15/hr mandate that would phase in the increase over five years instead of four; it would raise the tipped wage to $9/hr instead of $6.75/hr; it would also not index future wage increases to inflation. The governor is expected to sign the legislation but will likely wait until July 1 which is the deadline for Raise Up Massachusetts to officially withdraw its measures.

Anaheim, CA – By a 4-3 vote, the council advanced an $18/hr minimum wage initiative to appear on the Nov. ballot. As previously reported, the measure was crafted to narrowly apply to hotels on or near Disney property that are targets of an ongoing union campaign. The measure applies to businesses that have received city subsidies.

Washington, DC – Initiative 77, which gradually eliminates the city’s tipped wage, was approved by voters by a 55% to 45% margin. Currently, the tipped wage is $3.33/hr and the new law would increase it to $15/hr by 2026. The majority of city council members expressed their opposition to the increase and the city has the ability to adjust or rescind the ballot initiative through legislation. The law is also subject to a 30-day congressional review. It remains to be seen if or when the council may act.

Paid Leave

Massachusetts – As reported above, the grand bargain legislation establishes a family and medical paid leave program that would require businesses with 25 or more employees to provide up to 12 weeks of family leave and 20 weeks of medical leave with a maximum of 26 weeks total per year. Workers would be paid 80% of their salary up to a certain limit (around $670/wk), then 50% after that, to a maximum of $850/wk. The medical leave provision is funded by a 0.63% payroll tax split between employers and employees. Businesses with fewer than 25 employees do not have to pay into the fund. The family leave program is employee-financed. The governor is expected to sign the legislation but will likely wait until July 1 which is the deadline for Raise Up Massachusetts to officially withdraw its measures.

Wage Theft

New York City, NY – The city council set aside $2.5 million to support local legal aid groups representing workers who claim they are victims of wage theft. Expect the city to become increasingly active on the issue.

Joint Employer

Massachusetts – The senate approved a wage theft bill this week that would hold contractors, both the lead contractor and subcontractor, liable for wages, penalties or fines. The senate approved a similar measure in 2016 but at that time, the house did not take up the legislation.

Labor Policy

Federal Agency Reorganization – The Trump Administration released a plan to merge the Education and Labor Departments into a new agency called the Department of Education and the Workforce. Proponents assert the united agency would be able to seamlessly manage education programs, vocational training and apprenticeships. The proposal is unlikely to be acted on in the foreseeable future and is part of a larger plan to streamline the federal government.

Association Health Plans – The Labor Department released its long-awaited rule on association health plans. The rule is designed to expand options for smaller employers by allowing them to band together and form insurance pools. The New York and Massachusetts attorneys general are planning a lawsuit to stop the new rule, arguing that the new plans will not meet requirements set forth under the Affordable Care Act.

Activism

Immigration Protests – Immigration activists, in reaction to family separation at the border, have organized 130 rallies in 48 states to occur on June 30. While there is no indication that hospitality or retail locations will be targeted, some employers may experience call outs or work disruptions.

Taxes

U.S. Supreme Court – The court ruled in favor of South Dakota in a landmark case this week, overturning a long-standing precedent that states could only collect sales taxes from merchants with a physical location within their borders. In a 5-4 decision, the justices overturned the precedent set forth in the 1992 Quill v. North Dakota decision which established a physical nexus standard for sales tax collection obligations. In the majority opinion, Justice Kennedy cited the changing nature of commerce as the primary reason for the court to reconsider the Quill standard. Expect states to move quickly to require that online marketplaces collect and remit taxes on items shipped to customers residing in-state.

Massachusetts – The state supreme court ruled this week that the millionaire’s tax ballot initiative is unconstitutional. It would have added a surtax to income over $1 million. That decision eliminated a big piece of revenue the state needed to cover costs related to other ballot initiatives – a reduced sales tax rate, a paid leave program and a minimum wage increase. The decision spurred discussions and created the dynamics that allowed for the so-called grand bargain which includes an annual sales tax holiday in August rather than an overall reduced state rate. The compromise bill has passed the legislature and is currently on the governor’s desk. He is expected to sign it.

New Jersey – A bill was introduced last week that is modeled after the South Dakota economic nexus law which was recently upheld by the U.S. Supreme Court. The bill requires remote sellers with annual retail sales exceeding $100,000 into the state, or at least 200 in-state transactions, to collect and remit sales tax on their sales. The bill is expected to be amended to include language that would force online platforms to either collect on behalf of their third-party sellers or ensure that they are doing so on their own.

Data Privacy

California – A bill was introduced last week that could offer a pathway forward on data privacy issues and potentially avoid a costly and problematic voter initiative currently proposed for the Nov. ballot. The bill, The California Data Privacy Protection Act, would guarantee consumers the right to know what personal data has been collected by any company. It would also allow them to opt-out of future collection and hold companies directly liable in the event of a data breach. In a nod to some business concerns, the bill would allow the attorney general to levy fines for data breaches, only after which consumers could sue. The ballot measure exposed companies to litigation regardless of the state attorney general’s action. Privacy advocates have said if the legislature passes the bill and the governor signs it by the end of the month then they will withdraw the more onerous ballot initiative. The demand for hurried action by legislature (this month) may cause the deal to fall through.

Trade

ChinaThe Trump Administration, in a further escalation of the pending trade war with China, announced it would consider additional tariffs on up to $200 billion of Chinese exports. Consumer products, such as apparel, footwear, toys, and additional consumer electronics, may get swept into the expanded list of goods subject to these new import tariffs. The announcement comes after China responded last week to the final list from the United States ($34 billion worth of products) with its own retaliatory list of mainly U.S.-exported agricultural products.

European Union – Due to the U.S. decision not to grant the European trading block an exemption, the EU imposed tariffs on over $3 billion worth of U.S. exports in retaliation to the U.S. steel and aluminum tariffs. In a tweet President Trump threatened further retaliation in the form of a 20% import on automobiles imported from European countries.

Key Takeaways

  • Industries other than retailers (hotels, restaurants, c-stores, etc.) should view the U.S. Supreme Court’s South Dakota v. Wayfair decision as a victory. In its ruling, the court recognized that “old economy” employers were operating at a significant disadvantage relative to their “new economy” counterparts. While both were subject to the same tax and regulatory requirements, only the brick-and-mortar retail community was required to collect taxes. Consumers making online purchases were responsible for calculating and submitting sales tax, not the platforms, which in practice rarely happened. The ruling levels the playing field between traditional retail and e-commerce sales by now allowing states to require online marketplaces to also collect and remit taxes. Other industries can expect to face similar challenges as disruptive businesses gain market share. And, conservative justices just armed them with important talking points and legal precedent.
  • It appears healthcare will once again serve as a partisan campaign issue this cycle. The Labor Department’s announcement of a final rule on association health plans was met with immediate criticism, including a lawsuit from Democratic attorneys general. Congressional Democrats have already started campaigning on the issue, blaming the Trump Administration and the Republican-controlled Congress for exacerbating problems in the healthcare marketplace, just as many rates are scheduled to spike before Election Day. The campaign season’s political conversation may bleed into workplace conversations over healthcare benefits and employers should be prepared to answer questions regarding coverage as we approach open enrollment season.

Legislature Status for Week of 6/25/18

  • The United States Senate is in session this week
  • The United States House is in session this week
  • Eight state legislatures are meeting actively this week:
    • CA, DE, MA, ME, MI, NJ, OH, PA

Podcast

Check out our Working Lunch podcast each week that includes further analysis into these legislative issues, policy, politics and much more. You can find Working Lunch on the Nation’s Restaurant News website, or by clicking here, and when you download the podcast and subscribe on iTunes here.

The Regulatory Wrap-Up is presented by Align Public Strategies. Click here to learn how Align can provide your brand with the counsel and insight you need to navigate the policy and political issues impacting retail.

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