Morning Brew - ☕ Crust, but verify

How one small pizza chain developed its pick-up strategy.
March 07, 2023

Retail Brew

NewStore

Happy Tuesday! Consumers are reportedly pulling back on discretionary spending, which begs the question: What is discretionary? For example, does the 34-pack of La Croix we ordered for delivery last night count? What about the $6.99 delivery fee?

In today’s edition:

—Andrew Adam Newman, Maeve Allsup, Maia Anderson

QSR

Leveraged pie out

A pick-up window at a LaRosa's restaurant. LaRosa's

​​This is the second of two stories about how restaurants are investing in pick-up windows. Part 1 explored “Chipotlanes.”

Domino’s has been known for delivery for decades. In 1979, it guaranteed that if pizzas didn’t arrive within 30 minutes, they’d be free. But these days, it’s not “bringing pizza to customers” that it’s promoting.

It’s bringing customers to pizza.

Struggling with the labor shortage, particularly with drivers, Domino’s is offering a $3 credit for picking up orders, calling those customers “carryout heroes” in a recent commercial.

But you don’t have to be Domino’s, the largest pizza chain in the US with ~6,700 locations, to get religion about pick-up. You can also be LaRosa’s, a Cincinnati-based chain with 65 pizzerias.

Pete-za: In 2016, a franchisee-owned LaRosa’s in Cold Spring, Kentucky—which is outside of Cincinnati—opened the chain’s first pick-up window, according to Pete Buscani, EVP of marketing at LaRosa’s. The franchisee acted of his own volition, and the corporate office didn’t quite know what to make of it.

“Everybody was all nervous because we didn’t have any procedures and we didn’t have any policies,” Buscani said. “And [the franchisee] said, ‘Relax. They’ll roll up to the window. If they don’t understand it, we’ll explain it to them.’”

So Buscani and the rest of the corporate office did relax, and the pick-up window was “fabulously successful,” he said. But LaRosa’s did not think much about adding pick-up windows to other locations.

Until a couple of years later, when a woman told Buscani that she didn’t want to put on pants.

Keep reading here.—AAN

        

TOGETHER WITH NEWSTORE

Get the omnichannel scoop

NewStore

With a few years of perspective on the (sudden) global shift to retail, brands are taking stock of what’s changed. Many are making omnichannel solutions a part of their permanent strategy going forward.

And now you can get the 411 on all things omnichannel in NewStore’s 2023 Omnichannel Leadership Report. The research focuses on the availability of omnichannel solutions across three retail categories: online, mobile app, and store.

The 2023 global edition of NewStore’s report takes a closer look at omnichannel in Australia, France, Germany, Italy, Spain, and the UK, letting you compare omnichannel solutions across different regions.

In the six markets studied, they found that:

  • 96% of brands offer contactless payment
  • 23% of brands have a mobile shopping app
  • 59% of brands offer click-and-collect

Omnichannel is here to stay. Get the full report.

TECH

Dressed to impress

Two avatars show off distinct, colorful clothing items. Ready Player Me

Want to feel old? Listen up: Dall-E, the deep language model that generates images from text descriptions, was released by OpenAI all the way back in…January 2021. (Who can remember the first Dall-E picture they saw?)

In the wake of Bing’s chatbot Sydney attempting to break up NYT reporter Kevin Roose’s marriage, the hype around image-generating AI Dall-E may feel like a thing of the past.

But while Dall-E (which must be pronounced in the Wall-E voice for full effect) may have passed its spotlight off to Sydney, its application for retail brands remains intact. In the years since Dall-E’s release, we’ve seen it used by everyone from Heinz (ketchup in space, anyone?) to Nestlé (whose French brand La Laitière used Dall-E to turn an iconic Vermeer painting into a scene featuring the yogurt brand’s own milkmaid).

The AI-generated image opportunities for brands don’t stop with traditional marketing campaigns. Earlier this month, virtual avatar creator Ready Player Me (whose brand partners have included L’Oréal, Adidas, and Calvin Klein, and whose avatars can be used across multiple virtual worlds) made moves to bring generative AI to brands in the metaverse, and to change the face of digital fashion.

Ready Player Me’s latest feature (still in experimentation mode) uses Dall-E to customize and stylize clothing items for avatars used across virtual worlds.

  • The Dall-E integration is available to the public through Ready Player Me Labs, which serves as a testing ground for new features before they’re released to users.

So how does it work? In simple terms, Ready Player Me sends a user’s text prompt to Dall-E, receives the AI-generated image, and applies it to 3D wearables.

Keep reading here.—MA

        

PHARMACY

Taking care of business

A doctor holds out his hands to show graphics indicating value-based care. Leowolfert/Getty Images

“[CVS and Walgreens] have made a string of multi-billion dollar acquisitions of primary care providers in the past couple years…So what do all these deals have in common? Value-based care,” writes Healthcare Brew’s Maia Anderson:

A value-based care reimbursement model takes into account patient outcomes when determining how much to pay providers, rather than providers getting reimbursed for each individual service they provide to patients.
The goal behind the value-based care model ultimately is to lower the overall cost of healthcare. The model relies on providing patients with better health outcomes, and if patients have better outcomes and are healthier, then overall healthcare costs come down.

Read the whole story here on Healthcare Brew.

        

TOGETHER WITH COUPA

Coupa

Taking the temp. From cutting costs to investing in growth, CFOs are dealing with lots of push and pull. Luckily, Coupa surveyed 600 CFOs to figure out strategies that work IRL. See how CFOs are facing the current climate and making plans to drive growth (recession or not) by downloading the report.

SWAPPING SKUS

Today’s top retail reads.

Feelin’ the Bern: Next week, the Senate Health, Education, Labor, and Pensions Committee (led by former presidential candidate Bernie Sanders), will decide whether to authorize an investigation into alleged labor violations by Starbucks, and to subpoena the coffee giant’s CEO Howard Schultz. (The Hill)

Moving mountains: Toblerone is dropping the iconic image of the Matterhorn from its packaging as part of its plans to move some production abroad in order to comply with Swiss law protecting national symbols. (the New York Times)

Throwing a wrench: The lasting impact of the Covid-19 pandemic means Amazon is pumping the brakes on construction of its future second headquarters in Arlington, Virginia. (the Washington Post)

Comeback story: Hear from the leadership team of 2000s icon Abercrombie & Fitch about how they won back customers on TikTok. Download Marketing Brew’s report to unlock this success story and their strategic insights.

Inquiring minds: Want to know more about the worlds of science, history, travel, and tech? Check out Curiosity Stream and browse the deepest collection of the best documentaries ever. Start watching with 25% off.*

*This is sponsored advertising content.

WHAT ELSE IS BREWING

  • California is “done” doing business with Walgreens after the retailer said it wouldn’t dispense abortion pills in certain states, Governor Gavin Newsom said.
  • Nordstrom is closing its Canadian arm due to financial losses.
  • Alo Yoga launched a collection of metaverse athleisure—including a bucket hat, sweatpants, and a hoodie—during Paris Fashion Week.
  • Starbucks is opening 100 new coffee shops in the UK.
  • Walmart plans to open 28 new health centers, bringing its total to 75 by the end of 2024
  • Walmart’s CEO says he will stay in the role for at least three more years while on the hunt for his successor.

TIME MACHINE

What happened in the world of retail this week in…1910 and beyond? Retail Brew takes you way, way, way back.

  • On March 3, 2017, the Nintendo Switch became available to the general public. Nintendo has since sold more than 100 million of the handheld game devices.
  • On March 5, 1910, Momofuku Ando, credited with inventing instant ramen noodles, was born in Taiwan. Ando went on to found Nissin Food Products.
  • On March 6, 1912, Nabisco (the National Biscuit Company), unveiled the Oreo cookie for the first time to a grocer in Hoboken.
  • On March 9, 1959, the Barbie doll went on display in New York City at the American Toy Fair.

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Written by Andrew Adam Newman, Maeve Allsup, and Maia Anderson

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