Kent Hoffman

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On November 20, 2016, Kent Hoffman commented on Walmart working with Uber; Two Giants Join Forces :

Thanks for the great post, Ronnie! I wasn’t aware of WalMart’s Uber partnership but this certainly seems like a relatively easy and smart path forward to begin capturing share of this new eCommerce market. One question that I had (and something we talked about often at PepsiCo as well) is what happens to EDLP in a world of price transparency? I imagine WalMart is already working against this but, at least as first glance, it appears to be a major challenge for their customer promise in a world with greater price transparency where consumers can know how much any item costs at any retailer in a ten-mile radius. Clearly, we’re not there yet but this reality may not be too forward-looking. I suppose as long as WalMart maintains at least the cheapest basket of goods, they can still deliver on their promise but price transparency does threaten to increase the level of perceived commoditization and risk of retailers competing even more on price in pretty much all categories which would be a huge challenge on margins for retailers (and CPGs like PepsiCo too).

On November 20, 2016, Kent Hoffman commented on Online retailing and the Dollar Shave Club :

Great post, Pablo! I imagine part of DSC’s appeal was the perception that the razor industry was woefully over-complicated with its “flex-ball” technology and “every few years let’s add a blade” innovation approach. How many blades is enough? I’m not sure I know lol. Admittedly, I use one of those fancy blades but I did purchase it at Sam’s Club at a pretty steep discount over other channels. My question for DSC is how they can best commercialize the data they’re collecting by going direct-to-consumer. I imagine, assuming there’s a sufficient capacity for customization in the supply channel, that razors could move from one-size-fits-all to a more personalized, custom product by collecting data on performance over-time from users. Not sure if the world requires this level of specificity in razor design, but I could see customization as an interesting path forward to drive further differentiation given the consumer data DSC has compiled.

On November 20, 2016, Kent Hoffman commented on AMAZON IS BUILDING BRICK AND MORTAR BOOKSTORES. SERIOUSLY. :

Fascinating post! The usage of data here and integration of digital and physical is really intriguing. This reminds me of an argument that I’ve read against mobile (and the smart phone or tablet) as the future. In short, the mobile phone is pretty limited and while it’s proven the most versatile and economic way to usher in the digital age and reach a mass audience, it’s shortcomings may be why it’s replaced. The argument is similar to this one. Consumers are multi-sensory and want a multi-sensory experience which digital devices don’t deliver on well (in addition to being tiny print and often hard to read). The more likely future could be a world that looked very much the same prior to mobile’s proliferation, except all of our “things” are intelligent and divide/conquer what mobile does today to connect us to data and other people.

On that note, I need to find one of these stores…

On November 20, 2016, Kent Hoffman commented on Macy’s: America’s Omnichannel Store :

Interesting post! I enjoyed reading about how Macy’s is currently working to better manage the gap between the physical and digital world. Two additional thoughts that I had while reading were:
1) To what extent does Macy’s want consumers opting in to “shop online, pick-up in store”? While this definitely does provide a convenience for shoppers, and is likely something Macy’s needed to test as it’s a good entryway into a omnichannel shopping experience, I’m concerned about the “treasure hunt” nature of shopping and whether this impacts overall store performance. I imagine CostCo has avoided pick-up in store for a similar reason. I’d be curious to know if average basket size goes down as shopper navigate to shop online, pick-up in store.
2) The second was a question on whether Macy’s is considering investing in improving the experience of shopping in-store, adding features that can only be experienced live. I think this might be the future role for physical stores in a digital world so would be curious if Macy’s was also investing in this space.

On November 20, 2016, Kent Hoffman commented on What Can Brown Print For You? :

Interesting post, Carl! Agree with some of the previous posts on concerns around this new business segment being perhaps too far removed from UPS’ core competencies. I imagine even if 3D-printed parts does become a commodity market, there could still be benefits from economies of scale that individual companies may not want to invest in to achieve the necessary level of scale so UPS may have a value-added role if they consolidate enough demand to drive down prices.

My concern was how this might impact existing supplier relationships. I would guess that UPS is currently holding parts inventory from suppliers. In this new world, what happens to the parts suppliers? How UPS manages phasing out those suppliers while it works to replace them could create interesting challenges, especially if the suppliers opt out of using UPS as a midpoint in the supply chain and move to alternative logistics companies due to the competitive threat.

Thanks for the great post, Casey! Agree with many of the comments above that focusing on changing consumer demand via changing menu options could be a path forward. I imagine McDonald’s, which will need to adapt to changing consumer tastes anyway, would look at whether it truly needs several versions of burgers vs offering more incremental, albeit slower-turning non-beef options.

The McDonald’s brand, in general, has been under siege over the last decade for ingredient sourcing, food quality, health concerns, etc. I see sustainability as a possible path forward to once again resonate with a new generation (Millennials or Gen Z). While they’re just beginning to commit to improving sustainable sourcing, I agree with you that this effort needs to be accelerated and I see this as an opportunity, if done right, to re-build relationships with significant percentages of generations who’ve likely moved on from considering McDonald’s as a relevant brand or dining option.

On November 7, 2016, Kent Hoffman commented on Green Mission of Whole Foods Market :

Thanks for the great post, Iryna!

I value the role that Whole Foods is playing in bridging the gap between sustainable producers of food and consumers willing to pay more for those products. It’s a race to the top and one which benefits many stakeholders, suppliers, Whole Foods, consumers, the planet. One additional area of opportunity that I see is identifying ways for Whole Foods to create certain segments of products which are more economically accessible to a mass market but still produced with sustainable practices. Not all products in the store could fit this description but I see tremendous opportunity for Whole Foods to increase environmental impact in a positive way if it worked with suppliers to identify sustainable foods which could also be priced at accessible levels for a mass market.

On November 7, 2016, Kent Hoffman commented on C&S Wholesale Grocers – Innovating to Protect an Incumbancy :

Thanks for the great post, Carl!

I found the re-design of trucks which are more aerodynamic to be particularly interesting as this decreases total demand for fuel without any corresponding trade-offs on distribution center locations or pricing model adjustments. One additional area that I think C&S could pursue is looking to invest in technology to continue improving the overall fuel efficiency of their trucks by looking at how engines are designed or what types of fuel can be consumed (can they transition away from diesel fuel?).

We also looked at whether uncertainty often at Frito Lay as our business was highly transportation-intensive. One additional idea that your post sparked was looking at a dynamic inventory model, in partnership with retailers, where, given a certain likelihood of a weather event, C&S could temporarily increase shipment levels to retailers as an insurance against difficulty in delivering. If the weather event didn’t occur, shipments could subsequently decrease and revert back to average levels.

On November 7, 2016, Kent Hoffman commented on The Bitter Truth for Beer :

Thanks for the post, Hugh! I had two thoughts after reading:

1. Given some of the innovative ways that craft brewers are taking on environmental impact in their supply processes, I agree that MillerCoors should be exploring how to integrate some of these practices. One thought was using the more premium craft brands in MillerCoors portfolio as a testing ground for new initiatives as these are likely brands with higher degrees of inelastic demand and, if the changes in processes are communicated to consumers, would likely be valued by the consumers who purchase these more premium craft products.

2. Another opportunity would be a partnership with farmers to decrease the amount of water used in crop irrigation. Through a combination of influence given MillerCoors’ scale and expertise, it’s likely that there are still opportunities to improve the efficiency of crop irrigation to continue to improve the water-to-beer ratio.

On November 7, 2016, Kent Hoffman commented on Share a Coke with… Sustainability! :

Thanks for the great post, Ari! As a former PepsiCo employee, I felt obliged to respond.

Two thoughts that came to mind for me while reading:

1. Agree with many of the comments posted above on the challenges of a potential vertical integration. I’d imagine that the bottling partners likely have aligned long-term incentives with Coke, i.e. what’s good for Coke and helps to sell more bottles and cans is also good for them. If Coke can help to articulate the value Coke would provide to consumers by increasing its level of sustainability in production, and what impact that would have on sales, this could be an approach forward to push bottlers to change processes. Beyond this, focusing on the influence they have over bottlers to improve sustainability of operations feels like the right immediate step before moving to considering vertical integration.

2. An additional idea your post sparked for me is that Coke could leverage a campaign which has worked well for them, Share A Coke, and, as your title suggests, use this as a reason to engage with consumers in a sustainability conversation. If Coke credibly delivers on sustainability, Coke can encourage consumers to share how they’re helping to improve sustainability as Coke has done.