Yesterday we took note of a Wall Street Journal report that restaurants in New York City, tired of paying fees to the third-party contractors responsible for delivering their meals, "are increasingly finding a way around the issue by avoiding the platforms and assuming ownership of the process themselves. And they say the benefits go beyond the potential savings on third-party fees."
The third party delivery services justify their fees by saying they're providing more than just deliveries, but also the kind of promotion that restaurants cannot achieve on their own.
But the restaurants referenced in the Journal article clearly have come to a conclusion with which I entirely concur - that if you want to preserve and sustain your brand, you have to own the customer relationship. You can't outsource it, because when you lose control you run the risk of losing connection.,
This is, I hope, the conclusion that food retailers, having outsourced much of their e-commerce business to third-part contractors, also will reach. In the search for a quick solution, they may have engineered their long-term demise.
MNB reader Howard Schneider responded:
KC, I have always agreed with your perspective on this topic. Not only do third-party intermediaries take away the restaurant’s (or retailer’s) chance to interact with the customer; they also get extremely valuable customer data, which allows the service – not the restaurant – to market more effectively to the customer.
Writing about my piece looking at the new Roche Bros. store at Arsenal Yards in Watertown, Massachusetts, MNB reader Rich Heiland offered:
Your commentary on the new store grand opening, with all the residential developed around it, made me think there’s nothing really new under the sun. This is how it used to be, if you think about it. In most US urban areas clusters of stores developed to serve dense populations. Even in the rural America of my youth, we had small markets that were walkable for many folks. That’s remained the case in a lot of places overseas.
Recently my wife and I moved from Huntsville, TX to West Chester, PA. In Huntsville, we had two cars and had to drive for our every need. We now live in a two-bedroom apartment in a complex in vibrant, bustling downtown West Chester. We have gotten rid of one car. We still have to drive 5-8 minutes to the closest Acme and Giant supermarkets. But, the YMCA, Farmer’s Market, bank, drug store, library, arts center, more bars, restaurants and shops than I can count all are within walking distance. There are two or three complexes like ours in downtown and almost all the second story uses over several square blocks are residential. When we moved to suburbia post WWII and put two cars in every driveway we broke up markets.
Maybe it’s the pandemic. Maybe it’s environmentalism. But, whatever it is it seems in many cases were are returning to the market wisdom of the past. I, for one, am enjoying the hell out of. Now, I have to walk over to the Y……
But MNB reader David Spawn had a different perspective:
I have to take exception to your characterization of Arsenal Yards in this excerpt:
“The "lifestyle center" is an easy eight-mile commute to downtown Boston, and Cambridge is even closer. It is all part of creating a suburban center that offers urban amenities that will make it even more attractive.”
What’s “urban” about a suburban lifestyle center?? Acres of parking if even in a parking deck, access to office space from large format retailers, 8 miles from downtown Boston? This is a suburban development with amenities that serve customers better – doesn’t seem like there’s anything ‘urban’ about it. Maybe we can ascribe that over-used term ‘new urbanism’ that implies there was something to avoid about ‘old urbanism’ – and really seems to be about making white folks more comfortable by making it more ‘suburban’.
My point was that many people living in the suburbs now want the amenities traditionally offered by urban markets … in the way that Rich Heiland described above.
We had a piece yesterday about how Domino's Pizza is rolling out a robotic delivery service in Houston, Texas.
MNB reader Gregory Gheen responded:
I saw this on the news last night. A video showing it driving through the streets/neighborhood, at a pretty fast clip.
I immediately thought: What if someone steps in front of the delivery device and gets hit, hurt, or killed? Prior, you could blame the driver, etc. Now it would be....Dominos? The virtual driver? Human driving reaction vs computer? Capability to determine conditions, kids playing (so slow down), etc.
Great idea but they should reshoot their video driving through the neighborhood at a much slower speed.
Hey, they only have 30 minutes to get the pizza to wherever it is going. The rest of us will just have to get the hell out of the way.
Yesterday's FaceTime video focused on Taylor Swift's re-recording of her album, "Fearless," which is part of a project that has her redoing six of her early albums because of a dispute with the businessman with whom she has been in a long dispute; she is redoing the albums in order to render virtually worthless the original work, which he bought.
One MNB reader objected to my analysis:
Kevin go to Bob Lefsetz site and see what music attorneys say about this situation.
Don’t assume Big Red machine is a villain. Stick to groceries please.
Anyone who has read MNB for any period of time knows that I never stick to groceries.
A couple of things.
First of all, Big Red Machine is a baseball team - the nickname refers to the dominant Cincinnati Reds teams of 1970-79. The company you're talking about is Big Machine.
Second, I made the point in my commentary that I was not really talking about the relative ethics of people in the music business. This is a management-labor dispute, but in this case the labor is worth about $300 million. So I'm not really worried about her. (I'm also not putting too much stock in music industry attorneys.)
Third, my point was metaphorical. Frame the dispute as business-related, not ethical, and you realize that Taylor Swift has done an amazing job of creating a fan base that believes in the rightness of her cause, is willing to shell out money for music that it already owns, and that is in favor of her sticking-it-to-the-man perspective.
I believe this because my daughter tells me it is so … and then shows me all the social media postings that support her position.
That all said, I think the music is terrific - in August 2009, I took my then-teenaged daughter to see Taylor Swift on the original "Fearless" tour at Madison Square Garden, and it was a hell of a show. Also made my daughter happy … and she remains a fan of Taylor Swift all these years later. (She thinks I'm okay, too.)