Morning Brew - ☕ Honest Tea is the best policy

Honest Tea co-founder Seth Goldman’s other iced tea brand.
June 22, 2023

Retail Brew

Good afternoon, everyone. Summer’s now in full swing, which means you might find yourself at the beach, a park, or random field without pizza (horrible). Well, Domino’s has stepped up to the plate with its Pinpoint Delivery feature on its app. Users can drop a pin anywhere and get their ’za delivered to that exact location. Papa Johns, you have 24 hours to respond.

In today’s edition:

—Erin Cabrey, Andrew Adam Newman, Cassandra Cassidy

FOOD & BEV

Spilling the tea

Eat the Change co-founders Seth Goldman (left) and Spike Mendelsohn (right) Seth Goldman (L) and Spike Mendelsohn (R). Eat the Change

When we (Erin here, hi!) spoke with Seth Goldman, it was on a notable anniversary—one year since he announced his return to the beverage business, one that he’d thought he’d put behind him forever after selling his brand, Honest Tea, to Coca-Cola in 2011.

That was until Coca-Cola decided to discontinue the iced-tea brand (excluding the Honest Kids line) on May 23, 2022, aiming to double down on its other ready-to-drink teas, Gold Peak and Peace Tea.

Goldman co-founded the low-sugar iced tea brand in 1998, with a focus on organic, fair trade, and sustainable sourcing. The beverage giant acquired Honest Tea in 2011 after taking a minority stake in the brand in 2008, and scaled it to $500 million in revenue, distributed to over 150,000 retail locations.

After Coca-Cola’s announcement, Goldman took to LinkedIn to call the move “a gut punch.” He told Retail Brew that he and the Honest Tea team “spent a week mourning and just being sad and despondent,” he said. “We got just so much feedback from suppliers and customers and consumers who are like, ‘Oh, we want you to do something.’” He said his tea suppliers wondered if investing in organic and fair trade was “all just a failed experiment.” But Goldman wouldn’t accept that.

On June 6, 2022, he decided to re-enter the iced-tea business with Honest Tea co-founder Barry Nalebuff, creating what he would soon reveal was Just Ice Tea, a new brand from Goldman’s food company Eat the Change.

Keep reading here.—EC

     

FROM THE CREW

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GROCERY

Deflator Joe’s

A Trader Joe's sign along the roofline of a store. Nicolasmccomber/Getty Images

Pity the Trader Joe’s visitor who gets between a shopper and a jar of such cult favorites as Everything But the Bagel Sesame Seasoning Blend or cookie butter. The good news for Trader Joe’s these days is not just that so many of their products have enthusiastic fans, but also that more of them are visiting their stores.

Footloose: A recent report by Placer.ai, a foot-traffic analytics firm, tracked supermarket visits nationwide using January 2022 as a baseline and starting point. And while the visits to Trader Joe’s mirrored the broader category through July 2022, its visits since then have mostly been up while the category has mostly been down:

  • In October 2022, TJ’s foot traffic was up 6.4% while the broader grocery category was down 2.9% compared to that baseline of January 2022.
  • In January, TJ’s foot traffic was up 8.3% YoY while the broader grocery category was down 6.3%.
  • In May, TJ’s foot traffic was up 6.3% compared to the baseline of January 2022 while the broader grocery category was down 5.0%.

Inflate bloomer: One reason traffic may have increased during an inflationary period, the report notes, is the perception that Trader Joe’s prices are lower compared to some supermarkets.

Keep reading here.—AAN

     

E-COMMERCE

Suit yourself

Gavel coming down on the Amazon logo Francis Scialabba

“Yesterday, the [FTC] filed a lawsuit alleging that Amazon violated consumer protection laws by manipulating millions of customers to sign up—and stay signed up—for its $139-a-year Prime service,” writes Morning Brew’s Cassandra Cassidy:

The lawsuit claims Amazon did this by:
Making it harder for customers to buy products without a Prime membership.
Utilizing “dark patterns,” a design tactic that subtly convinces users to perform a specific action, to get users to enroll in Prime without their consent.
Designing a cancellation process that took six clicks, which was referred to internally as the “Iliad Flow,” a reference to Homer’s doorstop epic poem.

Read the whole story here on Morning Brew.

     

SWAPPING SKUS

Today’s top retail reads.

Splitting hairs: Unilever, one of the largest consumer goods conglomerates, is operating salons with the mission of serving the Black hair care market. (the New York Times)

Come back around: Shrink‚ or merchandise theft, has been a major headache for some of the largest retailers, but a UBS analyst believes it’s cyclical and its reduction could be a major tailwind for companies as early as later this year. (Yahoo Finance)

A peek behind the curtain: Bernie Sanders, who heads the Senate Committee on Health, Education, Labor and Pensions, has launched an investigation into what he calls Amazon’s “systematically underreported” injury rates, as well as its warehouse conditions and labor practices. (the Washington Post)

Save the day: Have you started saving for a rainy day? If not, read Money Scoop’s guide on emergency funds and start today.

Ditch the dupes? Gen Z loves “dupes”—aka duplicates of iconic items from luxury brands. Learn how retailers can convince consumers to shell out for the real thing in our latest article, sponsored by LTK.*

*This is sponsored advertising content.

VIRTUAL EVENT

Reimagining the Customer Experience Online

Reimagining the Customer Experience Online

In the fast-paced word of online shopping, customers crave a flawless, top-notch experience. With social platforms becoming shopping hubs, every second counts. To thrive in this competitive landscape, brands must deliver a five-star customer journey.

Join us for an exciting conversation on how JCPenney is meeting shopper expectations, capturing attention, and building lasting connections. Find out more!

Register here

NUMBERS GAME

The numbers you need to know.

Waiting in lines. It’s one of the most universally hated experiences. It’s also the one thing that can suck the fun out of going to an amusement park, and, evidently, the in-person shopping experience.

In the US, people spend about 37 billion hours a year waiting in lines, according to Waitwhile, a cloud-based software firm that recently released “The State of Waiting in Line 2023,” a study tracking how often customers queue up, how they feel about it, and how brands can improve IRL shopping.

  • The survey found that more than four in five (82%) of consumers will avoid patronizing a business with a line—with only 58% of those people returning to complete a purchase.
  • Forty percent said they’ll go to a competitor or not make a purchase at all.

“Over the past couple of years, we’ve seen consumers enthusiastically return to shopping at brick-and-mortar stores, dining in restaurants, and traveling, yet the expectations for service are growing and loyalty is fleeting,” Christoffer Klemming, CEO and co-founder of Waitwhile, said in a statement.

Americans are in line at retailers more often than restaurants, pharmacies, doctor’s offices, and banks combined. Two years in a row, retail is the top industry where consumers find themselves in lines. Plus, the length of time customers spent waiting in stores has increased by 30% since 2022.

  • Nearly 70% of those surveyed said they would rather schedule an appointment, and 57% prefer virtual queues.
  • 38% of consumers said they would continue shopping while waiting in a virtual queue.

“Businesses that want to create a meaningful connection with their customers and drive business growth must implement technology that streamlines customer flows, enables operational efficiencies, and modernizes the in-person experience,” Klemming said.

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Written by Erin Cabrey, Andrew Adam Newman, and Cassandra Cassidy

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