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Kroger Co. is joining the list of retailers that plan to scale back on brick-and-mortar locations this year. The grocery giant said in its first-quarter earnings report on Friday that it will shutter roughly 60 stores over the next 18 months, a move that it expects will provide a “modest financial benefit.” Kroger said the store closures will not impact its guidance for 2025, during which it expects operating profit of between $4.7 billion and $4.9 billion. The move to close stores comes about six months after Kroger’s proposed takeover of rival grocery chain Albertsons failed to pass muster with regulators. The $25 billion merger was abandoned, but it was a messy breakup, with both companies ultimately suing each other in attempts to claw back damages. Kroger’s newly announced closures are likely to attract further criticism of the company in some impacted communities. Although the retailer says all employees affected by the closings will be offered roles at other locations, many cities are already struggling with so-called food deserts, and the loss of even a single grocery store can sometimes create additional hardships for residents. Which Kroger stores will close? Kroger has not provided a list of stores that will be impacted. However, local media outlets have reported on a number of locations that have recently closed or will close in the coming months, with some citing local unions or elected officials. Dickinson, TX Location is closing in June (Houston Chronicle) Gassaway, WV Location is closing in August (WCHS) The Woodlands, TX Sterling Ridge location reported closed in May (Community Impact) McKinney, TX University Drive location is closing (WFAA) Dickinson, TX Location reportedly closing in June (Community Impact) Abington, VA Location reportedly closing in September (WFHG) Bristol, TN Location reportedly closing in September. (WFHG) It’s unclear if the above locations are part of the 60 locations included in Kroger’s earnings disclosure on Friday. Fast Company reached out to Kroger to ask for additional information on which 60 locations will be impacted, including a timeline for when the stores are expected to close. We will update this story if we hear back. Kroger Co. stock (NYSE: KR) rose almost 10% on Friday following its earnings report. Cincinnati-based Kroger operates 1,239 grocery stores in 16 states, according to its store locator. It owns a number of well-known regional chains, including Ralphs, QFC, Fred Meyer, and Food 4 Less. The United Food & Commercial Workers Union, which represents Kroger workers at many stores, did not immediately respond to a request for comment. This story is developing and may be updated.
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E-Commerce
Misbehavior on digital platforms can be tricky to manage. Issue warnings, and you risk not deterring bad behavior. Block too readily, and you might drive away your user base and open yourself to accusations of censorship. But a new study, presented at the Conference on Human Factors in Computing Systems, suggests a more effective path forward. Researchers at Northeastern University and Roblox conducted two large-scale field experiments involving more than 770,000 Roblox users to study how suspension duration affects user behavior. The first experiment compared one-hour versus one-day suspensions for users with a single recent policy violation. The second experiment compared one- to three-day suspensions for users with a second recent violation. They tracked outcomes such as likelihood of reoffending, number of subsequent violations, user reports against offenders, and engagement metrics like days active and total time spent on the platform. Its very common for platforms to issue consequences for violations of the community standards, but theres actually not a ton of causal evidence in the research about how effective different kinds of consequences are, says Jeffrey Gleason, one of the studys authors and a researcher at Northeastern University and Roblox. The study found that longer suspensions significantly reduced reoffense rates, the number of consequences, and user reports. Longer suspensions also appeared to make users think twice before misbehaving again, increasing the time it took for them to reoffend. The longer the suspension, the greater its impact on user behavior. A one-day suspension reduced reoffense rates by 6.7% compared to a one-hour suspension, while a three-day suspension reduced it by 8.1% compared to a one-day suspension. The deterrent effect lasted for at least three weeks, though its impact diminished over time, suggesting that some users eventually reverted to old behaviors. One promising approach is to address bad behavior early. Harsh penalties for first-time violations were more effective at preventing repeat offenses. A one-day suspension lowered reoffense rates by 12.6% for first-time offenders, compared to just 4.4% for frequent violators. And despite concerns that suspensions might drive users away, the study found that users generally remained active on the platform after being banned. Theres always been this long debate around what is the trade-off between safety and engagement, and the fact that were seeing that you can do really important safety-related work while not sacrificing engagement is maybe not surprising for us, but may be surprising for other platforms, says Alex Leavitt, principal researcher for trust and safety at Roblox and co-author of the paper. The experiments only tested suspensions of up to three days, and the effects of longer suspensions remain unknown. Its also uncertain how these findings would translate to other platforms. Still, the research offers valuable insights into curbing bad behavior online. We now have more public evidence around that fact, says Leavitt, so we can lean into that.
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E-Commerce
Hello and welcome to Modern CEO! Im Stephanie Mehta, CEO and chief content officer of Mansueto Ventures. Each week this newsletter explores inclusive approaches to leadership drawn from conversations with executives and entrepreneurs, and from the pages of Inc. and Fast Company. If you received this newsletter from a friend, you can sign up to get it yourself every Monday morning. A new McKinsey & Co. study finds that CEOs and their chief marketing officers (CMOs) are becoming increasingly disconnected, and the gap between CEOs and CMOs perceptions of the marketing function appears to be widening: Nearly two-thirds of chief executives say they are comfortable with modern marketing, up from just half in 2023; meanwhile, only 31% of CMOs believe their CEOs are comfortable in the marketing world, down from four points from a year earlier. That may be part of the reason CMOs and other creative leaders I met at Cannes Lions last week suggested that chief executives consider spending some time at the annual festival of creativity. To be sure, most marketing executives arent suggesting CEOs come to Cannes Lions for a deep dive into marketing tactics and metrics. Rather, they feel corporate leaders would benefit from being immersed in an environment that celebrates and inspires groundbreaking multimedia work and its creators. A creativity immersion experience I would love to bring CEOs to the basement of the Palais so they could see the work and draw inspiration from that, says Valerie Vargas, senior vice president, content creation and advertising, AT&T, referring to the conference center where Cannes Lions winning entries are exhibited. Vargas also recommends that someone from the head of advertising or marketing hand-pick a series of talks for the CEO to attend, sparking ideas and new ways of thinking about problem-solving. Finally, she suggests the marketing team organize a dinner for the CEO and their agency creative teampeople who usually dont get to meet with the companys top executives. Others believe a trip to Cannes could help CEOs understand the role that creativity will play as companies adopt generative AI tools and other technologies to increase productivitymaking it harder for many companies to boast an operational or information technology edge. Were moving to a world where creativity is the single most important differentiator among brands, says Zach Kitschke, global chief marketing officer of Canva, the design software company. David Droga, vice chair of Accenture (and most recently CEO of Accenture Song), goes one step further: Creativity is going to drive the outcomes of AI, he says. Thats what creativity has done every time it has been infused into a new technology. He cites the example of modern photography, a technology that was invented and advanced by chemists and scientists but flourished and took on new energy in the hands of artists and other creatives. Marisa Thalberg, executive vice president and chief customer and marketing officer for retailer Catalyst Brands, contends that Cannes may not be right for every CEO but says its important for chief executives to understand the value for attendants. For me, Cannes is a uniquely valuable few days, not only for the creative and business inspiration but for the concentrated opportunity for learning, connections, and idea generation, says Thalberg. I can make more happen in a few days that would otherwise take weeks . . . or never happen at all. Can Cannes bring CEOs and marketers together? CEOs, are you disconnected from your marketers? Marketers, what dont your chief executives understand about your role? Send your thoughts to me at stephaniemehta@mansueto.com, and Ill try to work the answers into my newsletters. Watch more: Cannes do How PepsiCo is using chips to power street food entrepreneurs Inside Apples award-winning advertising The future of socializing
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E-Commerce
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