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Major Executive Shake-Up at Conde Nast
Adweek: Condé Nast is in the midst of a major shake-up in its executive ranks that has president Bob Sauerberg greatly expanding his role and COO/CFO John Bellando and editorial director Tom Wallace departing the company. In a companywide memo this morning, CEO Chuck Townsend detailed a string of high-level shuffling that, he said, comes as part of a succession plan begun earlier this year. Sauerberg “will assume a leading role in all revenue generation activities,” wrote Townsend, which includes oversight of the entire Condé Nast Media Group. Media group president and CRO Lou Cona will now report directly to Sauerberg. Exiting the company are Bellando, a 15-year veteran of Condé Nast, and Wallace, the former editor-in-chief of Condé Nast Traveler. Per Townsend, Bellando will continue to work with Condé "in an advisory capacity" through the end of the year. Replacing Bellando as CFO is David Geithner, formerly a Time Inc. EVP and president of its entertainment group, let go from Time Inc. earlier this year in a round of cutbacks. Townsend did not name a direct replacement for Wallace, who has held been editorial director since 2005, but said that Condé Nast artistic director and Vogue editor Anna Wintour "will ensure that our content and culture remain at the forefront of our industry," adding, "Bob and I will rely on her for her insights and guidance as we build the team that will lead us into the future." Ad Age: Some at the company believe Wintour had been intruding in Wallace's turf. Ad pages across the entire Conde Nast portfolio were down nearly 6% through the July issues of their monthly titles and the June issues of The New Yorker, according to MIN. At Hearst, print ad pages for monthlies were down almost 5%. Time Inc.'s ad pages were down about 6%.

Fashion Mags See Mixed Results on September Ad Pages
Condé Nast's Vogue, the perennial September issue ad-page leader, again this year shows the best tally at 631, but that's a 4.5% decline vs. last year’s 661 ad pages. Time Inc.’s InStyle (celebrating its 20th anniversary), came in second with 485, a 6% gain. Hearst’s Elle has 465 pages, up 5.2%. Other tallies: Harper’s Bazaar 444 (+11.6%); Glamour 215 (-4%); W 303 (+5.2%); Vanity Fair 232 (-1.9%); Marie Claire (also turning 20 this year) 265 (+7.3%); Cosmopolitan 188 (+9.1%); People StyleWatch 203 (up less than 1%, from 191); Town & Country 143 (+25.4%). Teen mags hit hardest. Lucky -34.3% to 90; Teen Vogue -33.9% to 112; Seventeen -6.2% to 106. GQ flat at 203; Details -10% to 132. WSJ Magazine +23.3% to 90; NY Times Style Magazine +4% to 127. Two travel mags saw big gains: Departures (celebrating 25th anniversary) +48% to 185; Condé Nast Traveler +15.2% to 91.

Bloomberg Enters Venture Capital Biz
Bloomberg Beta, the $75M fund backed by Bloomberg LP, was launched last June with a mission to spot smart startup ideas and entrepreneurs before they hit the big time. It focuses on startups that improve how people work. The VC arm has built a diverse portfolio of companies that include media (newsletter company Redef), customer relationship management software (Prosperworks) and telecommunications hardware (goTenna). Its approach is already paying off. One of its early investments, Newsle, became Bloomberg Beta’s first high-profile exit when it was acquired by LinkedIn for an undisclosed amount.

Amazon Makes Plea to Authors to Quiet Down
Since author Douglas Preston began circulating a letter to other marquee and midlist authors late last month in an effort to remove writers from the Amazon-Hachette dispute, he has captured nearly 1,000 author signatures. Now Preston tells PW that he's gotten a second offer from Amazon's VP of Kindle Content, Russ Grandinetti, along with a request from the executive to quiet the chorus of authors speaking out against the e-tailer. This time, Grandinetti suggested a what-if scenario in which Amazon would return to delivering Hachette authors their standard royalties on e-books, and return to stocking all of the publisher's titles. Amazon and Hachette, meanwhile, would continue to negotiate, turning all proceeds each company normally earns from the sale of e-book titles over to an agreed-upon literacy charity. Preston echoed his response to Amazon's first proposal, saying that this offer from Grandinetti "has the same effect of crippling Hachette. If [Hachette] wasn't making money for Lagardère, they'd shut it down." Amazon contends that authors are not seeing Hachette in the right light, as a multi-national corporation no different, on many levels, than the e-tailer. Preston is also unmoved by Grandinetti's assertion that the authors' activities are actually impeding negotiations. ("Every time [the authors] make a statement, it makes Hachette less willing to compromise," Grandinetti is reported to have said.) Instead, Preston is moving forward with plans to publish the initial letter. In a day or so, Preston will stop adding names to the letter so that he can finalize a copy for a full-page New York Times ad that could run as early as this week or next. Preston believes that the e-tailer’s attempt to divide Hachette authors from their publisher won’t work. “The thing about Amazon, they think it’s all about money. It’s not [all] about money,” says Preston. For another group of writers, though, Hachette, not Amazon, is the bad guy. A letter/petition to Hachette CEO Michael Pietsch posted three weeks ago on has gotten over seven times the number of signatures as the Authors United letter. Among the 7,300 signers of the petition are Hugh Howey, a leading spokesperson for indie authors.

Inside The Atlantic's Event Juggernaut
Atlantic Media has built its AtlanticLive events arm into a thriving business by making its highbrow brand more accessible. It started hosting live events in 2006; today, it puts on some 125 of them a year under the Atlantic brand, doubling their revenue in the past four years, to represent close to one-fifth of the Atlantic’s overall revenue. A knowledgeable source said AtlanticLive is profitable and brings in close to $10M annually. The largest is the week-long Aspen Ideas Festival, a partnership with the Aspen Institute that hosts 4,000 people paying as much as $3,000 for a four-day pass. The Atlantic also has been adding smaller events like New York Ideas, which drew 815 people paying as much as $149 this year; and Start-Up City: Miami, which drew 700 people paying $75. Bob Cohn, COO and co-president of The Atlantic, with oversight for Live, said putting on successful events isn’t unlike doing great journalism: It needs to start with a good idea that can be brought to life in a live setting and appeal to underwriters. Live employs a team of 30 in content, sales, marketing and operations/logistics. Starting in September, Live will be overseen by Margaret Low Smith, formerly SVP of news at NPR. The events provide another touchpoint with consumers and give the brand another platform to sell to advertisers. (The Atlantic’s sponsorships go for up to $700,000 for a major event, per knowledgeable sources). They also create content for the editorial side. Last year, Aspen Ideas generated more than 100 stories for The Atlantic’s site. The events succeed in part because of their tight integration with the editorial side. Steve Clemons, Live’s editor-in-chief, is also Washington editor-at-large for the Atlantic. But the competition is getting tougher, particularly in the consumer events space.

Good Housekeeping U.K. Preps Cooking School
Hearst Magazines U.K. is moving the Good Housekeeping Institute out of GH's editorial offices to a standalone location in London. Move will allow GH to expand its range of testing dramatically, to encompass nursery, beauty and tech products. In addition, starting this fall, the Institute will open its doors to the public as a cookery school and demonstration kitchen--providing direct access to the Good Housekeeping experts and showcasing their famous triple-testing process.

Comic Sales Up, in Print and Digital
Print and digital seem to be coexisting well within the comics business. A new report estimates that North American sales of comics--whether single issues, collected editions or digital downloads--were $870M for 2013, up from $635M in 2012. Digital sales rose to $90M from $70M.


Retail News

Safeway: Q2 Profit Jumps; Reports DEA Is Examining Its Drug Record-Keeping
The Drug Enforcement Administration is looking into Safeway Inc.'s record keeping related to the theft of controlled substances, the supermarket chain disclosed Tuesday. Safeway, which has agreed to be acquired by a group led by private-equity firm Cerberus Capital Management LLC, said in a regulatory filing that it received a subpoena from the DEA and is cooperating in the investigation. Safeway said it doesn't expect any potential liability to "have a material adverse effect" on the company's results "taken as a whole." Safeway also reported sharp increase in profit for quarter ended June 14: $95.6M, or 41 cents a share, up from $8.4M, or three cents a share, year earlier. Revenue rose nearly 2% to $8.31B (analysts had expected $8.39B); same-store sales +2% vs. a 0.9% decline a year ago. Excluding fuel, same-store sales +2.5%, vs. +1.4% year-ago. Profit margin narrowed to 25.8% from 26.3% year ago.

First TargetExpress Opens for Business
First TargetExpress--at 20K sq. ft., about one-sixth size of traditional format--to open today in Dinkytown, Minn. The prototype feels like a drugstore along the lines of a CVS or Walgreens, but has its own Target flair with merchandise that includes groceries, bedding, smartphones. Target is increasingly eyeing opportunities in the urban core, following population growth in those areas. So far, only about 11% of its stores are in urban areas, but in 2012, it began testing its 80K-100K-sq.-ft. CityTarget format. Now there are eight CityTargets in cities such as Chicago, San Francisco and Portland, Ore. Target says it’s too early to say how many TargetExpress stores it might eventually open, but it's already planning four more locations for 2015--one in St. Paul, Minn.’s Highland Park and three in the San Francisco Bay Area.

Hillshire Sees Success with Mobile Beacons
Hillshire brands and IPG Mediabrands-owned agency BPN report that beacons--devices set up in brick-and-mortar stores to trigger location-based offers--increased purchase intent and sales for American Craft link sausages. A mobile campaign ran from April to June to push American Craft link sausages in the top 10 markets in grocery stores in the U.S. The campaign targeted consumers who had downloaded one of the apps in inMarket’s network (which includes Condé Nast’s Epicurious and Gannett-owned Key Ring). The network claims to hit 50M consumers. Consumers who used the apps in-store were sent a branded push notification from Hillshire. The campaign also included banner ads within the app that linked to a full-page ad with a coupon and content. After the campaign, inMarket surveyed groups of app users who didn’t see the ad against those who did. The offers claim to have lifted purchase intent by 20% and brand awareness by 36%. Some 6,000 engagements were measured during the first two days of the campaign, which measures the number of times someone received, opened and viewed a push notification ad while in-store. In comparison, inMarket’s internal data finds that the average consumer packaged goods brand sees about 3,000 views with content in one week.

Union News: Food 4 Less, Kroger
UFCW authorized a strike for workers at Food 4 Less stores in Southern California, employing about 6,500. Worker unions across the region have been negotiating with Food 4 Less and parent Kroger, but the talks have hit a snag. Union leader Mickey Kasparian says Food 4 Less employees are paid less than Kroger's other grocery store chain, Ralph's, and that the negotiations have centered around securing equal pay and keeping benefits intact. In a statement, "Food 4 Less is committed to reaching an agreement with the union that is good for associates and allows the company to continue to operate in a very competitive market...We remain hopeful that the union will have the same commitment to keep our associates working as we go through this process." Union representatives and Food 4 Less will meet again today, but Kasparian says the union is already preparing for a strike...UFCW Local 75, representing nearly 16K Kroger employees in the greater Cincinnati and Dayton, Ohio regions, has reached a tentative new agreement with the retailer on a merged contract for workers in both areas. UFCW said the deal provides the same healthcare coverage and wage levels for cashiers, customer-service representatives, stock workers and other employees in both of Southwest Ohio's two largest metropolitan regions. "It is a very good proposal with good wage increases, affordable healthcare and continued investment in our associates' pension for retirement," a Kroger spokeswoman said. The Dayton-based union is scheduled to vote on the agreement July 29. UFCW Local 75's contract expired in October, and it has been working on short-term extensions since then.
CBS News San Diego (Food 4 Less) (Kroger)

Consumer Confidence Up in Q2
Nielsen's Q2 Global Confidence report shows that U.S. consumer confidence increased four index points to a score of 104, continuing an upward trend that started in Q1 2013 and has registered an 11-point increase since then. 49% of Americans said they believe it's a good/excellent time to spend, the highest level since 2006 and up 6 percentage points from Q1 2014 (43%). "While the outlook for jobs (46%) was still below pre-recession levels (63%), the sentiment represents a significant improvement from 2009, when it was at 20%," writes Nielsen. 6% of of U.S. respondents said their personal finances were in good order, up 5 percentage points from Q1. "Positive news for job, housing and equity markets appears to have buoyed the spirits of Americans,” said Nielsen SVP global consumer insights James Russo. "The retail environment for non-durable goods, however, is still catching up. Retail dollar sales of fast-moving consumer goods are up 1.3% in the latest six months ending June. Consumers are moving ahead slowly, and marketers need to adjust to a new consumer mindset of restraint, which will take time to reverse.”

Amazon Debuts Mobile Wallet App
Amazon’s first attempt at its own mobile wallet application, designed for use at point-of-sale, has made a quiet debut on the Amazon Appstore and on Google Play. But the current implementation of the new “Amazon Wallet” app is fairly barebones: It doesn’t yet support mobile payments or the ability to store credit cards or debit cards. It only offers the ability to store and organize gift cards and other store and loyalty cards.

Walgreens Incentivizes Healthy Habits
As part of an effort to help its 81M loyalty cardholders modify behavioral risk factors associated with the most urgent public health issues, Walgreens is launching a “Balance Rewards for healthy choices” initiative. Participants earn Balance Rewards, which can be redeemed for cash rewards at Walgreens, through several tracked activities, including using fitness devices, or  tracking their blood pressure and glucose levels at home--in each case connecting their rewards accounts to the tracking app or device--or participating in a Walgreens smoking cessation program, or logging their weight over time. SN provides more details.

More on Harris Poll's Top Grocers by Region
As cited here yesterday, the latest annual Harris Poll EquiTrend (EQ) study shows Publix being ranked highest by consumers in the South, based on three key factors: familiarity, quality and purchase consideration. MNB reports more regional results for the grocery category. Hy-Vee gets top marks in the Midwest, Wegmans in the Northeast, and Costco in the West. Also ranking above the grocery store category averages: In the Midwest, Meijer, Giant Eagle, Kroger, Whole Foods, Trader Joe's, Walmart and Jewel & Jewel-Osco; in the Northeast, Trader Joe's, Whole Foods, ShopRite, Hannaford Bros., BJ's, Stop & Shop, Costco, Price Chopper and Giant Food Stores; in the South, Walmart, H-E-B, Trader Joe's, Harris Teeter, Whole Foods, Kroger, Sam's Club and Target; in the West, Trader Joe's, Whole Foods, Safeway and Stater Bros. Markets.

PepsiCo Reports Higher-Than-Expected Net
PepsiCo reported a higher-than-expected profit in quarter ended June 14, and raised its full-year adjusted earnings forecast, helped by strong sales of snacks in North America. Organic revenue grew 5% in the global snacks business, partly due to price hikes, and 2% in the beverages business. N.A. snack volumes +2.5%, but soda volumes -2%. PepsiCo raised its full-year earnings per share growth forecast from 7% to 8%. Its net income fell 2% to $1.98B, or $1.29 per share, from $2.01B, or $1.28 per share, a year earlier. Analysts had expected $1.23 per share on revenue of $16.81B. PepsiCo's shares have risen 7.5% this year to Tuesday's close.

Opinion: Hartman on Winning Over Millennials in Grocery Retail
Hartman Group CEO Laurie Demeritt shares lessons for food retailers from the firm's "Outlook on the Millennial Consumer 2014" report. Excerpts: Millennials' "goals are not especially unique: They want to build careers, spend time with friends and travel. But Millennial shopping and eating behaviors are exceptional, and as the largest generation since the Boomers, their choices have a big impact on overall consumer trends. In that way, they are a sort of barometer for future consumer behavior and warrant retailers’ close attention. It’s worth knowing, for example, that Millennials shop all channels and tend to go most regularly to stores in close proximity. They connect with brands that have good prices, similar values and a personality they can connect with--particularly one that’s playful and quirky and appeals to their sense of irony. At this age, they enjoy experiences more than traditional status and wealth symbols--and they prefer intimate retail experiences that include knowledgeable, helpful staff. Those findings...should tell mainstream retailers that they have an excellent chance of capturing Millennials’ interest if they offer good prices and the right messaging."

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