Staples Workbar won’t fix the overall problem

Oh boy. As Staples (and its failed merger partner, Office Depot) tries to recover from disappointing sales, it has partnered with Workbar to set up office spaces for customers in a few stores around Boston.

Staples Workbar
The Staples Workbar space is nice, but who cares?

The space is far back from the retail area where customers can work without having their own real office. Said Evin Charles Anderson, whose video production company has been using the space, “On the weekends when we’re here, we see people peering in through the windows.”

Yeah. They’re wondering what the hell Staples is doing. The office supplies stores are in a free fall with Office Depot closing stores and regulators ending the proposed merger between Staples and Office Depot.

Staples Workbar is a tactic, not a strategy

Both supply stores, in fact, are looking for new CEOs to lead the retailers into a new era where all retailers are becoming more and more irrelevant. The Workbar additions, just in beta stage at this point, won’t hurt but it won’t fix the problem either.

For one thing, who wants to work in the back of a Staples store? FedEx, off its successful merger with Kinko’s, has something similar that has now existed for nearly a decade.

More importantly, however, the working world is no longer dependent on having a traditional office or even one that resembles one, such as the Staples Workbar situation.

As many employees at very large companies will tell you, working from home is the new normal. (The sheer number of them doesn’t even consider freelancers.) You may go to FedEx Office for shipping but you can buy just about anything off the internet. There’s no need to go to a Staples store to work.

That is, unless Staples had a brand that compelled you to seek it out.

But there’s no emotional reason to go to Staples or even the Staples Workbar space, which is the only reason to create preference. As Napoleon said, “You must speak to the soul to electrify men.”

That’s what the office supplies stores are missing. They believe they can out-tactic their way out of their dilemmas, rather than looking at a complete overhaul of what they provide and what they mean.

I’ve been thinking recently that the entire brick and mortar retail market is in serious trouble. Malls are becoming a thing of the past and the industry as a whole is losing their shirts to Amazon.

So, there’s now Staples Workbar. OK. So what?

Will LeEco kill the Vizio brand? You bet.

Chinese content provider LeEco announced that it will purchase US television brand Vizio for $2 billion. Until recently, few consumers in the US had even heard of LeEco. In China, it is a pretty big deal. Called the “Netflix of China,” LeEco’s services runs the gambit from Amazon-like shopping, driverless cars, online content, smart phones to TVs. And that’s not even the full list.

LeEco has been trying to break into the US market for some time now and that task has finally been accomplished. But what does that mean for the Vizio brand?

Vizio
Say goodbye to the Vizio brand

In 2015, Vizio accounted for one out of every five TVs sold in the US. By and large, Vizio TVs are generally well reviewed and, with a 20% market share, there are a lot of US consumers that would agree.

But don’t be surprised if LeEco kills the Vizio brand.

If true to form, LeEco will first change Vizio’s name to be in sync with the rest of its products. It will join the family of LeTV (everything in LeEco’s stable begins with Le) and LeEco will incorporate its acquired brand into what it refers to as its “premium ecosystem user interface.” That will allow consumers to have access to LeEco’s online content with 100,000 TV episodes and 500 films. Compare that to Netflix (4,300 movies) and Hulu (5,300).

Why Vizio will become something else.

But LeEco is not really buying Vizio to get into the TV business in the US. It is buying Vizio to get all of its businesses in the US, particularly its mobile phones and driverless cars. That is further proof that Vizio is doomed.

Chinese companies have traditionally had a difficult time in the US. American’s won’t buy Chinese car brands (though we buy US brands made in China). We shy away from Chinese TV brands – TCL, Hisense, and ZTE – as well as Chinese phone brands like Xiaomi, Huawei and Meizu. Again, we have no problem buying Chinese-made products owned by western companies. But, considering the current economic and political climates, there is something about Chinese companies that leads Americans to reject them.

The once strong rallying cry of “Made in the USA” has switched to “I don’t really care where it’s made as long as it’s not a Chinese company.” What’s odd is that we have little problem when a Chinese company buys a US company such Starwood Hotels, Smithfield Foods and GE’s appliances division. When a Chinese company enters the US market as its own Chinese brand, however, we dig in our heels.

This is the problem that LeEco will face if it really wants to be successful in the US market. It will be much easier for it to succeed if it kept the Vizio brand intact instead of bringing it into the LeEco ecosystem of brands.

If Vizio becomes LeTV, the acquisition will fail.

Verizon’s purchase of Yahoo makes little sense

My first question upon hearing that Verizon is paying $4.8 billion to buy Yahoo was: Why would Verizon do that?

Yahoo has been a declining brand for some years. In the 90s, it was the search engine and counted millions among those who had an email address with the tech company. It won its battle with AOL and its future was bright.

Yahoo
The price may be cheap, but I don’t know what Verizon is getting from Yahoo.

But Yahoo never evolved after Google entered the market and took over so overwhelmingly that google is now a verb.

A better way to judge Yahoo’s downfall is to remember that Microsoft was willing to pay $45 billion for it just nine years ago. The $4.8 billion Verizon just ponied up is chicken feed in comparison.

The strategic purpose of buying Yahoo

Verizon’s overall strategy is to become a larger technology and media company rather than just a mobile carrier. It wants to count Google, Time Warner and Amazon as its competitors. Its recent purchases of AOL and the Huffington Post prove that. But it has an overall strategy that has yet to come to true fruition.

So why Yahoo? I suppose Verizon wants access to its one billion users. But AOL once boasted of those kinds of numbers. As we learned, those AOL customers were basically empty ones as they sported AOL email addresses they never used. Yahoo did buy Tumblr and brought in Katie Couric to be some sort of news anchor, for what it’s worth.

But it has been a brand without purpose. All that mishmash of what it had didn’t add up to a satisfying whole. It was a collection of disconnected parts.

Part of the reason why I wonder why Verizon would buy Yahoo is that, so far, Verizon’s collection also seems jumbled. What is Verizon going to become?

I suppose we should let this play out and see what Verizon will emerge as. But it worries me when companies grow through acquisition and not organically.

Verizon needs to come up with a brand promise that unites all its offerings. That was the problem Yahoo always had. No one could state what how its users were different than any other kind of user. It had no unifying brand.

If Verizon wants to make some sense of what it will become, then it needs to re-examine its brand. Because, right now, it doesn’t have one that will impact the market the way it should and buying companies like Yahoo don’t fix the problem.

The Bayer Monsanto merger needs your attention

The world of crop protection, if you’re not aware, is both important and cutthroat. And it’s something of which we should all pay attention.

There are a handful of main competitors who are either constantly battling the EPA or fighting environmentalists along side the regulatory agency, depending on your bent.

Bayer Monsanto
Growing crops is about to get a whole lot more expensive.

It’s also a changing industry. The main players, such as Monsanto, Syngenta and Bayer, have long been under fire because their lead products were pesticides. Those chemicals raised the hackles of environmental groups and have spawned thousands (if not millions) of papers, editorials and books (started by Rachel Carson’s seminal book, Silent Spring.)

Today, however, those manufacturers are increasing their investment in seeds, which are genetically modified to increase crop growth and stave off infection from pests and disease.

That is why Bayer is offering $62 billion for Monsanto, the largest seed producer in the US, for a Bayer Monsanto merger I can see happening.

The pitfalls of the Bayer Monsanto merger to you.

There are positive and negative outcomes of this proposed merger, starting with the benefit the companies themselves would receive. The battlefield now is over combined resources, especially worldwide, to increase research and development, and also to enter into developing markets.

The power of the seed market is that the next worldwide shortage is promising to be food. The population of the Earth is increasing but the amount of farmland is not. The only way to meet the world’s future needs is to make crops more robust and stir up agricultural production in those developing countries.

Leaving aside the potential negative effect of genetically modified seeds, the effect on the farmer – and the US economy – is potentially deadly. Mergers are becoming the norm in crop protection, with Dow and DuPont joining forces last year and rumors of Chinese companies interested in Syngenta still circulating.

Mergers mean less competition and less competition means higher prices.

Keeping track of the mergers in crop protection is not usually top of mind for consumers but they are important developments to notice. Seeds are seen as a healthier alternative to pesticides, but more research to needs to be done.

But sticker shock will soon be coming to your nearby grocery store. In the US, we take for granted what is available and what food costs. However, a Bayer Monsanto merger will change all that. Prepare to spend more of your dollar at the grocery store.

Gannett wants to buy Tribune

The news that Gannett, owners of USA Today, is offering to buy Tribune Publishing should not come off as a surprise. Tribune, which owns the Los Angeles Times and the Chicago Tribune among other assets, had been clinging to life in the new digital world.

Gannett
Sadly, Tribune Publishing should take Gannett’s offer.

You don’t need me to tell you how difficult newspapers have found it staying relevant when instant news comes over our social media apps and fewer people actually have a subscription to a newspaper.

Newsrooms nationwide are smaller, with half the news staff or smaller than they had years ago. Reporters are generally younger because they are cheaper. We’ve seen newspapers shut down, consolidate with another media group or become online only. A newspaper that a colleague of mine once wrote for downsized so much that it rented out most of its building and moved the newsroom into the cafeteria. True story.

It’s the way of today’s world.

Gannett has survived while others have not.

Gannett has been one of the few that have survived, primarily on the back of USA Today. It has firmly established itself a position, as the newspaper that gives you national headlines (just like social media does) that targets those who are away from home. You can’t go to any hotel in America and not find a USA Today.

Tribune, meanwhile, has seen half of its value decline in the last nine months, while Gannett has gained 16% in value over that same time. (It also owns newspapers in Phoenix, Indianapolis and Cincinnati, among many others.) It has also been one of the few media giants to understand how to have a strong online presence. It has a brand.

What makes this offer so compelling is that Tribune stated it has no interest in discussing the offer. I can understand the reluctance. Before the newspaper crash hit, those who worked in the industry thought of Gannett as superficial in terms of reporting news. If it bought your paper, it meant that investigative reporting was a thing of the past. Editors and reporters scoffed at the Gannett model.

Sadly, that’s where we are when it comes to the media today, as I’ve stated before. There are very few places that truly dig into issues, and they tend to come from the e-magazine side or from a giant like The New York Times.

It’s a good and honorable battle Tribune is fighting but Gannett is counting on Tribune making the realization that it can only survive and be relevant if it adopts some of the Gannett strategies and tactics.

As disappointing as it may be to those old ink-stained reporters, Gannett is probably right.