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Last Friday, we reported how Best Buy has opened its first health-and-wellness store there, dubbed EQ-Life, which has “shelves of air purifiers, yoga mats and organic cough syrup -- not to mention a full-service beauty salon and spa,” as well as a pharmacy.

Two MNB users have actually visited the store…and were kind enough to share their impressions.

MNB user Jim Wisner wrote:

I visited the Best Buy EQ-Life store during their soft grand opening with great expectations. Best Buy is a smart company with well-honed merchandising expertise. Unfortunately, the store is another “great, new, concept” that plays out well on paper, but somehow gets over-engineered and fails to connect. Strangely, what is missing most is a sense of value and merchandising energy, hallmarks of the Best Buy approach in electronics.

The store is very attractive, gorgeous in fact. Personnel are trained to connect with the shopper, and kudos for that. The store is squarely focused at women, and Best Buy understands that it has to be more than item, price, and variety. On the surface, the product mix looks a little eclectic (coffee, CDs, computers, OTC medications, a day-spa, supplements, skin-care, salon items, and “techie” wellness stuff) but is extraordinarily consistent with the research we have done for GMDC as categories that define wellness for a woman. It requires some serious right-brained thinking, but it does make sense. But the store has the feel of being a museum. All the pieces are there, but they are too understated, and strive for style over substance. You can have both.

Pricing on basic items appears to be extraordinarily high. Price tags are in 10 or 12 pt. type, seeming to say “you don’t want to know”. Most health care purchases are made by individuals over 50—many of whom cannot read type that small without assistance. Departments are well-segmented, but signage is weak.

There are a lot of items that you don’t see elsewhere…high-tech scales and the like. This is clearly a sort of Williams-Sonoma for wellness buffs. To be successful in the long-run, however, Best Buy will need to tap a little more into mainstream and add what they know about merchandising in other categories. They are on the right track, but need a little more energy behind the product.

MNB user Joseph Friedman had the following thoughts:

I was in the Minneapolis/St Paul area on business Tuesday (just missed the -24F and -25F (without the wind chill) days on Sunday and Monday!) and walked into the EQ-Life store.

The store’s grand opening will be Feb 4, 2005. I was there during their first couple of days of being open to the public. They referred to this as their “soft” opening.

The store is unique in many respects. It has a very clean and open atmosphere with well spaced out product sections.

I was given a tour of the complete store and also spoke with the director of pharmacy operations.

The EQ-Life pharmacy will be managed by Prairie Stone. Prairie Store has similar pharmacies formats in local supermarkets. It seems Prairie Stone will the pharmacy in all EQ Life stores. The footprint of the Prairie Stone pharmacy is ~450 Sq Ft, about half the typical supermarket pharmacy footprint.

They are completely automated and it appears their prescription “drop-off” to “pick-up” time will be very fast.

About the store itself…

Upon entering the store, immediately to your left is a Caribou Coffee shop. This represents a great sit down, stay a while, feel good and relax addition to the store concept.

Each section of the store is designed to combine health, wellness, and technology into a single shopping experience.

A customer can buy a health information oriented PC and there are also (mostly free) monthly classes on subjects such as Yoga, Health Screenings, and even classes on how to buy an IPOD. There are flat screen TV’s hung on walls throughout the store displaying futuristic images and store information. The floors are hard wood, and the wall colors are pastel. The outside signage gives little indication of what this store is all about. The store is located in a strip mall not far from Best Buy’s corporate headquarters.

For classes and customer point of sale information, the store employs a registered nurse, and a registered dietician about 20 hours/week.

The store has the latest high tech equipment that covers most aspects of human health monitoring and information. There is also an abundance of displays for popular/new-age self-care health related books and periodicals. Touch screen health information is available on two HealthNotes Kiosks.

There is a large spa within the store that offers Facials, Skin-care, Massage, Manicures, Tanning, and waxing services. Very “Health-Club” oriented.

There is also a warm and inviting “Community Room” for instruction classes.

The product selection is mostly name brand and represents the best products offered for Health and Wellness. These products span the scope of Personal Care, Exercise, Vitamins and Supplements, OTC Drugs, Health Solutions, and Salon care. The store offers many products that are high end, and quite often “exotic”, ie: available exclusively at EQ Life. Many of these products are imported from Europe and other countries.

It is my feeling that a price conscience consumer would hesitate to shop in this store. I would call EQ-Life the “Sharper Image” of a health & wellness store that contains a pharmacy.

Interesting that one person sees it in the mold of Williams-Sonoma, and the other as a kind of Sharper Image…which are pretty much the same thing.

Thanks for painting these word pictures…the MNB community is grateful.

By the way, MNB user Dan Raftery corrected something we wrote last week:

Two thoughts: You indicated that this will be a superstore. If so, that would be a mistake. A better approach is the creation of a new angle on the old "category killer" concept. Best Buy can carve out a lot of SKUs from one of their typical superstores, add new SKUs and offer this new concept store with a smaller and more friendly footprint.

Secondly, if they do this right it will be a great example of lifestyle marketing, along the lines of what Starbucks has done. I'd love to see it work. It would not just be equilibrium, it would be simplification.

We had a piece on Friday about a study in Tennessee indicating that more than nine thousand of Wal-Mart’s some 37,000 employees in the state are getting benefits from TennCare, the state’s expanded Medicaid program.

Wal-Mart says that it offers a health plan available to full-time workers after six months and to part-time employees after two years, and responded to the new study by saying that employees make their own decisions.

However, the study also gives ammunition to the company’s critics, who often accuse it of providing insufficient benefits to its employees. Wal-Mart currently is embarking on an ad campaign to counter that criticism.

One MNB user wrote:

How many people who are out there applying for that "entry level" job with Wal-Mart are doing so because they don't mind waiting two years until they qualify for insurance? In all likelihood, they need a paycheck now, no matter how meager. The interesting number would be how many actually are still there two years later to collect on this benefit.

Another MNB user wrote:

I have a sneaking suspicion the emphasis of the AP report - that a study in Tennessee indicating more than 9,000 of Wal-Mart's some 37,000 employees in the state are getting benefits from TennCare - was focused squarely on those who need the state’s help. Unfortunately, that emphasis basically glosses over the fact that some 28,000 of Wal-Mart's employees, about 75%, DON'T need or use TennCare. That's a BIG number and certainly puts things in a different perspective when you actually take the time to think about it.

There are many companies out there that don't come close to achieving that kind of percentage, but in a world where Wal-Mart bashing seems to be a chosen and accepted norm - since they are the biggest and baddest retailer out there - anything goes (especially if you have an agenda)! Let's face it; 9,000 is a big number, too, but the issue of low-paying, uninsured, part-time jobs is not some freakish, Wal-Mart creation. This is an industry norm that easily pre-dates the Bentonville Behemoth. Many people (retailers) will point the finger at Wal-Mart in hopes of gaining some sort of advantage, but wholesale changes that overturn the "norm" in these areas will have far reaching effects that could make an already difficult competitive situation that much more tenuous - not better.

One MNB user offered:

This study is obviously an attempt to slam Wal-Mart. Does the study mention all the other employers who have employees using the state's health care system? What about Kmart, Target, or McDonalds? Really now, do really expect any company to pass out expensive health plans without anything in return?. Wal-Mart does a great service to this country by hiring people who have probably made some poor career and education choices. In reality, Wal-Mart's health plan is really no different that what any other retailer offers relative the quality of employee hired. From what I have seen, the Wal-Mart health plan is one of the most affordable plans available.

Sure some retailers such as Costco help the employees out a lot more, but Costco is hiring a better quality employee. These studies are flawed because they assume that all people are equal with regards to their contribution to the economy.

Being self-employed I have to pay about $8,000 a year premiums with a $2,500 deductible per person. Some of my colleagues pay even more and tell me I have a good deal. In fact, I'm on a state sponsored plan. If I were to get a job that offered health insurance, the state says I no longer qualify for benefits. One way the state of Tennessee can reduce the number of Wal-Mart employees on the TennCare plan is to require them to purchase Wal-Mart's health insurance. It might even be cheaper for the state of Tennessee to give these employees an up front tax credit to pay the premiums rather than have them go on the TennCare plan.

Actually, the report did speak to all the other companies with employees on TennCare…but Wal-Mart was singled out as the company with the highest number of employees on the plan.

We find it interesting that you say that Wal-Mart employees often have made poor career or education choices. Actually, some of them may not have had a lot of choices…but that’s almost beside the point. It also is curious that you believe that Costco is hiring a better quality employee. Actually, we think that the employee base from which they are choosing is largely the same…but that Costco treats its people as if it is hiring a better quality employee.

Finally, we’re not sure it is fair to say that the study is a “slam” on Wal-Mart if the implication is that the people who conducted it had an agenda going in. Sometimes it seems that anyone who criticizes Wal-Mart or even asks questions about its behavior is judged to have an agenda. Which is not necessarily true.

By the way, MNB user Rick Sharpe had some thoughts about Wal-Mart and Costco employees:

I've been shopping in San Diego for over 30 years.

I absolutely have seen no discernable difference in the attitude and actions of Costco employees towards their customers than I have seen from Wal-Mart, Target, Vons or Ralphs employees. I have had good and bad experiences with all these retail businesses.

In my opinion, the alleged better pay and working conditions of Costco employees have not related to a more positive employee image for Costco shoppers over their competitors. You rarely have an opportunity to even engage a Costco employee on the floor. Where are they other than at the Checkout Line or running a forklift around the customers? I have been a regular Price Club/Costco customer since the 70's. I endure for the prices.

"Taking the Money" is the most important business relationship in retail. All the above companies are miserable failures at this function with their customers. Couldn't one of these companies take any initiative to improve this function with their customers? Long lines to "Take the Money" is the last impression a customer frequently has before he leaves the store. We are all happy to get out of there.

We had an exchange of emails last week with MNB user Mark Heckman about an episode of NCIS that suggested as a plot point that grocers sell frequent shopper info to telemarketers…

Kevin, I also happened to be watching NCIS when the actor (playing the telemarketer) spouted out his assertion that retailer were selling frequent shopper data to all who would buy it. We also know that most retailers have very stringent policies about the release of data, particularly "name, address, and phone". It proves once again that many in the arts (if you want make the stretch to call TV an art) have agendas and use their work as a means to promote that agenda. One of the writers must be on the warpath against database and telemarketing. It will be interesting to see if CASPIAN (anti frequent-shopper card organization) and others pick up on this. Luckily NCIS is not a top rated show, but it still may have some unfortunate negative impact.

To which we responded:

Actually, Mark, NCIS is usually a top-20 show (most people don’t know that). So you might be surprised by how many people saw it.

The interesting thing to us is that even though we know that we’ve never heard of a chain that does what was described on
NCIS, our first reaction was that it seemed as least possible that some retailer would do so...after all, most chains are driven by a need to build the bottom line with as little cost as possible, and you can make an argument that accepting money for a list isn’t an enormous philosophical leap from accepting slotting allowances.

We’re not saying that someone is doing it. We are saying that if a story came out tomorrow saying that such a thing had happened, we wouldn’t be enormously shocked.

Would you?

To which Mark wrote back:

You make a good point, … is believable as hell…..and I think part of that stems from a long-standing, almost subliminal level of consumer distrust of retailers. I have been in many focus groups where consumers will tell you that promotions are schemes, impulse items and displays are seen as customer manipulation….etc, etc.. They think retailers are out to get them.

What is ironic about this is that most, not all, of the retailers who have frequent shopper programs have gone out of their way to protect their customer’s data and in fact err on the side of NOT sharing it with CPG’s and other partners…..even though that partnership may produce some real new] benefits for the consumer, as they are scared stiff about customer backlash.

Also the level of distrust about frequent shopper programs is heightened when the consumer provides all of this information and does not get anything back from the retailer in terms of relevant offers and rewards. Consequently, consumers think they and their data is being sold down the river to someone who wants to sell them long-distance.

The lesson, of course, is that retailers need to do a better job not just of serving as an advocate for the consumer, but of communicating that fact.

Joining in our recent discussion about women in the food industry, MNB user Marv Imus wrote:

Kevin, I happen to agree with you on the women being in place to make decisions In our industry. Our store runs about 77% women shoppers and I have worked hard over the last couple of years to place women in charge of our depts. So now a woman is the head of all but one of our depts., even in our meat dept, which was an interesting change for our consumers. Meat is historically a male dominated area and there are not very many women who are cutters. But now we have not only our manager but our top two cutters are all women. The consumer was a little surprised at first but have since readily accepted and have been responding and related to them as I had hoped. Having said all this and being happy with the results, I would not just hire a woman without consideration of a man for a job. They still have to have the knowledge and skills for the job. I just don’t care what sex they are any more.

We joked last week that there ought to be one basic rule: no food or beverage should have anything in it that most people can‚t pronounce.

To which MNB user Denise Remark-Lundell responded:

Food is full of chemicals--actually, food IS chemicals. Most people, being who they are and not chemists, probably can't or don't care to have to pronounce such things as pyridoxine, calciferol, alpha-tocopherol, cobalamin, or para amino benzoic acid. And those are some of the easy ones! But B-6, vitamin D, vitamin E, vitamin B-12 and PABA are all in the foods we consume each & every day, either occurring naturally or as fortifications. I do not expect everyone to know & understand the technical names for substances.

However, I DO want to know whether or not a manufacturer is using d-alpha tocopherol or dl-alpha tocopherol acetate (natural vs. artificial vitamin E) and want it labeled as such. So, I understand where you're coming from, Kevin, but we need to have specifics outlined on ingredient labels. And if there's ever any question, just ask someone with Sprue-Celiac disease about the importance of label disclosure!

We noted last week that “Wal-Mart’s Asda Group announced that its new advertising spokesperson will be Sharon Osbourne, wife of Ozzy and mother of Jack and Sharon.

That was, of course, an error…as one MNB user pointed out:

Sharon cannot be mother to herself. She is mother to Jack and Kelly, wife of Ozzy. Watch the key strokes....sometimes the brain goes faster than the fingers.

And sometimes the brain is completely disconnected from the fingers. Trust us.

One MNB user was kind enough to send the following email:

From time to time I find your comments to be inspiring. For examples your comment today regarding the orange juice ad roll out for fall "...if you're standing still, you're actually moving backwards" that is applicable to basically everything in terms of making progress on anything. Another favorite is one from January 3, 2005 "...if you are thinking of excuses you are not thinking of solutions". I have repeated that second one to myself several times as I attempted to embark on professional and personal endeavors.

Thanks…that made us feel better about the occasional times that the brain and the fingers actually work in tandem…
KC's View: