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Report: Physical stores and technology have strong appeal for ‘omnishopper’

BY Marianne Wilson

NEW YORK — While the use of technology in shopping is almost universal, brick-and-mortar stands strong, with the “omnishopper” choosing physical stores for better customer service and a faster, more social buying experience.

That’s one of the key findings of a report released on Wednesday by MasterCard, which notes that the continued appeal of physical retail might be a contributor to e-commerce’s relatively flat growth as a share of total retail sales (7.5% globally).

Eight out of 10 global shoppers’ purchase decisions are now informed by a digital device, with consumers saying they are smarter shoppers and getting more value than before. While in-store sales still account for more than nine-tenths of all retail spending, the result is a more focused in-store shopper buying from a narrower list of unique stores than in years past, the report finds.

Getting smart about smart shoppers is paramount to a retailer’s success, yet shoppers consistently report they’re frustrated that retailers don’t get it,” says Mathieu Loury, senior VP of Merchant Solutions for MasterCard Advisors, the professional services arm of MasterCard.

The study, “MasterCard Retail CMO’s Guide to the Omnishopper,” combines survey data from thousands of shoppers around the globe with transaction-based insights from MasterCard. Key findings include:

  • Consumers Want Specific Inventory, and a Seamless Experience Accessing It: Today’s shoppers know what they want. The top frustration – cited by 73% of respondents – is items not being in stock, underscoring the importance of inventory management for retailers.
  • Consumers Feel Smarter and Get More Value: Fully 80% of global consumers claim to be getting more value, both in-store and online.

Merchants Are Primed for Omnishoppers’ Loyalty: Despite having nearly endless choices a click away, only 26% of shoppers like to try new merchants. This can pose a challenge for retailers trying to attract new customers. Just 20% say technology has led them to consider a new retailer.

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Congress explores impact of health sector consolidation

BY Michael Johnsen

WASHINGTON — The Judiciary Committee of the House of Representatives on Thursday morning convened to discuss the ramifications of consolidation in the healthcare sector. 
 
"One of the principal tenets of economics is that competition can lead to lower prices, enhanced product variety, greater innovation and downward pressure on costs," Rep. Bob Goodlatte, R-Va., said. "When markets consolidate, there exists the potential for reduced competition resulting in the contraction of the related benefits," he said. "Continuous and vigilant oversight, such as at today’s hearing, will help to ensure that health care markets operate as freely and competitively as possible, in order to provide consumers with premier and affordable health care."
 
“We commend today’s hearing and other efforts by Congress and federal regulators to conduct a thorough examination of the significant consolidation occurring in the health care marketplace," commented Douglas Hoey, CEO of the National Community Pharmacists Association. "Policymakers cannot allow the ‘merger mania’ gripping the nation to proceed in a way that harms patients and the community pharmacists who serve them," he said. 
 
“In the past, NCPA has expressed concerns regarding similar proposed mergers of other corporate giants in the health care realm — most notably involving the consolidation of pharmacy benefit management corporations. Already independent community pharmacies grapple with one-sided, take-it-or-leave-it contract terms from PBM corporations that hamper patient access and the ability of pharmacists to provide top-notch care. Additional consolidation may exacerbate this problem by increasing the disproportionate leverage health insurers have over providers," Hoey added. 
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Kroger names 4 new EVPs

BY Michael Johnsen

CINCINNATI —  Kroger on Thursday announced the appointment of four EVPs to lead key lines of business. Mike Donnelly has been named EVP merchandising, Chris Hjelm has been named EVP and chief information officer; Fred Morganthall has been named EVP retail operations; and Mike Schlotman has been named EVP and CFO. 
 
“Kroger is fortunate to have an exceptionally strong group of leaders across our company,” said Rodney McMullen, Kroger's chairman and CEO. “Our entire senior leadership team brings unmatched depth and experience to achieve our goals. This new organizational structure will help Kroger achieve laser-focus to accelerate growth, improve our connection with customers and deliver value for shareholders.”
 
Each leader has been assigned additional responsibilities to streamline decision making under this new organizational structure, the company said.
 
Donnelly, 57, formerly SVP, will continue to lead the company's merchandising, procurement and marketing teams. He has additional responsibility for digital, manufacturing and corporate brands, supply chain, culinary innovation, The Little Clinic and Vitacost. Donnelly joined the company at Fry’s Food Stores in California in 1978 and was promoted to his current position in 2011.
 
Hjelm, 54, formerly SVP and chief information officer, will continue to serve as CIO and lead Kroger Technology, research & development and the company’s customer connect and support centers. In this expanded role, he will take on additional responsibilities for 84.51 degrees, indirect sourcing and corporate travel. Hjelm joined Kroger in 2005.
 
Schlotman, 57, formerly SVP and CFO, will continue to serve as CFO. In this expanded role, he will take on additional responsibilities for convenience stores, jewelry stores, data integrity and risk management. Schlotman joined the company in 1985. He was promoted to CFO in 2000.
 
Morganthall, 64, formerly SVP retail divisions, will lead all supermarket retail operations for Kroger. Under this new structure, Kroger's three SVPs responsible for retail divisions will report to him. Morganthall began his career in grocery retail in 1978 with Spartan Stores in Michigan and joined Harris Teeter in 1986. He joined Kroger in 2014 as part of the Kroger-Harris Teeter merger and was promoted to his current position in June.
 
Also today, Kroger announced the retirement of SVP retail divisions Geoff Covert, and the promotion of Sukanya Madlinger as his successor. Madlinger currently serves as the president of Kroger's Cincinnati/Dayton division. She will be succeeded by Tim Brown, who currently serves as president of Kroger's Delta division, based in Memphis. 
 
Brown’s successor will be named at a later date.
 
Covert, 64, is retiring after nearly 20 years with the company. Before joining Kroger, he spent 22 years in a number of management positions with Procter & Gamble. Covert joined Kroger in 1996 as VP of the grocery products group. He later served as SVP and president of Kroger manufacturing, before being named president of the company’s Cincinnati/Dayton division. In 2010, he was promoted to SVP retail operations. Covert has served in his current role since 2012.
 
“We have valued Geoff's insights and contributions to our manufacturing and retail operations teams,” McMullen said. “We thank Geoff for his many years of dedicated service to Kroger, and wish him and his family the very best in retirement.”
 
Madlinger, 52, joined Kroger in 1986 in the store management training program and has held various leadership positions in operations and merchandising before being named to her current role as president of the Cincinnati/Dayton division in 2010.
 
“Sukanya is an outstanding executive whose leadership has always reflected her passion for our associates and the customers we serve,” McMullen said. “Her experience and commitment to our Customer 1st strategy will make her a great addition to our senior leadership team.”
 
Brown, 55, began his Kroger career at the age of 17, working as a bagger at a store in Illinois. He joined the company's management training program in 1981. Throughout his 38-year career, Brown has served in leadership positions in merchandising and operations in seven of Kroger's retail divisions and at the company's general office in Cincinnati. He has been president of Kroger's Delta division since 2012.
 
“Tim is a dynamic leader whose commitment to our associates, customers and communities is an example for others to follow,” McMullen said. “He brings a broad range of experience to our Cincinnati/Dayton division.”
 
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