Latest news with #NicholasBloom
San Francisco Chronicle
27-07-2025
- Business
- San Francisco Chronicle
‘Crisis moment': Are the Bay Area's supermarkets turning into ‘ghost stores'?
Every Safeway shopper in El Cerrito has a pet conspiracy theory about why company brass rearranged the grocery aisles. Years ago, the aisles were separated into two rows, with a gap in between for shopping cart passage. That all changed with the pandemic, when store workers consolidated the shelves so they extended from the checkout stands to the pharmacy in back. The design, more redolent of a warehouse than a traditional supermarket, can feel disorienting. And Safeway's explanation — that front-to-back aisles help maximize space and 'improve product adjacencies'— only added to the mystery. Toni Favila, who was outside the store on a recent morning, said she suspects that the long, unbroken aisles provide better sight lines for store security. Others swore up and down that the layout traps customers so they buy more groceries. A few shoppers see a different rationale. Safeway and other marquee stores are evolving for an era of e-commerce, with a large share of their customer base now ordering through an app and getting groceries delivered at home. Big titans such as Safeway promote their own apps for online shopping and delivery, though third-party platforms are also exploding. Instacart, an app that helped steer shoppers online more than a decade ago, reported 83.2 million orders throughout North America in the first quarter of 2025 — up 14% from a year ago. As the technology becomes more pervasive, it's started to warp the look and general vibe of the big chain grocers where people traditionally did their weekly shopping trips. Some have transformed so dramatically, they've come to resemble distribution centers. While shoppers may complain that Safeway's super-stretched aisles are harder to navigate, the setup appears to make it easier for 'pickers' — employees who push carts down the aisles, grabbing items for customers who've ordered online. In another particularly telling sign of the trend, many big box stores now keep fewer cashier stands open, encouraging shoppers to either use self-checkout, or do their bulk shopping through an app. At the Safeway in San Francisco's Castro neighborhood, shoppers gingerly sidestep a wheeled service cart stacked with industrial-size baskets for pickers. 'Let us shop for you!' a sign on the side of the cart exclaims. Once considered an essential staple of any thriving neighborhood, the American big box grocery store may be crumbling, felled by the same forces that closed shopping malls and turned so many sit-down restaurants into takeout stands. The next phase for urban supermarkets, according to Stanford University economics professor Nicholas Bloom, is that they become 'ghost stores': vast storage facilities that exist only to support e-commerce. 'You end up with this spiral,' said Dave Rochlin, a professor at UC Berkeley's Haas School of Business. 'People stop going into the store, because it's better not to. Then you're stuck with stores that have insufficient traffic. And it's a crisis moment.' Most people grasp the positive benefits of online ordering, which started out as a luxury and became ingrained during the pandemic. The rise of remote work led more people to want frictionless lifestyles and helped popularize the idea of an 'omnichannel' business. Target, which had enormous success with delivery and pickup during COVID, probably inspired competitors, including the private equity firm that owns Albertsons and Safeway, Rochlin said. A spokesperson for Safeway declined to share the company's online order data, saying it is considered proprietary. The pandemic had other side effects, Bloom noted. Workers moved out to the suburbs, draining foot traffic from supermarkets in cities and heightening demand for grocery home delivery. Members of this new telecommuting class tend to have more disposable income, so it makes sense for large chains to cater to them. Bloom and three fellow economists — Scott Baker, Stephanie Johnson and Jana Obradovic — describe these shifts in a new paper, in which the authors analyzed a massive database of Nielsen home and shopping surveys. They found that the sustained prevalence of work-from-home has led to a 10% increase in spending on 'food and general merchandise' since 2020. Moreover, remote work households paid higher markups and bought fewer goods on sale, the authors observed. But as grocery chains across the country pour their innovation, talent and investments 'into the online part of the business,' brick-and-mortar retail spaces start to deteriorate, said Santiago Gallino, an associate professor at the University of Pennsylvania's Wharton School. Stores that have already lost walk-in customers are more sensitive to theft and street chaos outside, Bloom said. Once these issues become too aggravating, companies may decide it's not worth it to stay open. This story has already played out in San Francisco, with the closure of the Mid-Market Whole Foods in 2023, and the Fillmore Safeway in January. To people who prefer the old ritual of driving, biking or walking to a store and loading groceries into a cart, evidence of the migration online is everywhere. Customers who order online and come to the store for pickup often get premier parking spaces reserved near the entrance. Inside the store, pickers or professional gig-work shoppers are ubiquitous; woe to the person who stands in line behind an online delivery app worker with three separate orders, requiring three separate transactions. On top of it all, managing inventory has grown increasingly difficult, Gallino said. Supermarkets are now dealing with two separate 'inflows' of demand — one online, the other from customers inside the store. 'Traditionally, inventory is very tightly planned,' Gallino said. 'Then suddenly you have this influx of online orders, and you have to coordinate online and offline demands. It's annoying for both (types of) customers. If you order online, maybe half the items are available and you have to go to the store anyway.' Already, some customers are revolting. 'I actively avoid (El Cerrito) Safeway,' said Ian Malec of Richmond Annex, who has adapted his shopping habits. He's embraced the European model, making multiple trips a week to neighborhood markets that are pricier than Safeway but have the scruffy charm of old corner stores. The shelves, which are smaller and discretely separated from the check stands, are geared toward idle browsing rather than picking items for online orders, Malec said. Neighbors who haven't abandoned the El Cerrito Safeway say they mostly go there for small trips — 'what we call a two-bagger,' said Richmond resident Mischka Schaeffer. For bulk purchases, Schaeffer typically shops at Costco, an originator of the warehouse retail concept. Another customer, Mialani Quitugua, said she tries to be 'very targeted' when visiting a grocery store in person. Otherwise, she shops online. One chain that disavows online orders is Trader Joe's, which emphasizes the brick-and-mortar store as part of its brand. 'We love being a real place,' Trader Joe's vice president of marketing, Matt Sloan, said on a company podcast. He and his interlocutor, fellow marketing executive Tara Miller, touted the virtues of a small store composition, where customers can show up, discover new products and get recommendations from the staff. 'That experience would not be the same if you were trying to order something from a website that just showed you the products you already know about,' Miller said. Other chains have leaned into shopping and delivery apps believing — sometimes prematurely — that their customers will also embrace the technology. David Burke, a public safety liaison in the Castro, remembers when the online craze took hold of his local Whole Foods. More than a decade ago the upscale chain partnered with the online delivery platform Instacart, offering customers the 'convenient option' to place orders through an app, and pick them up at a participating Whole Foods Store. At the time, it was forward-thinking. Yet shoppers like Burke, who prefer to browse shelves in-person and haul their own baskets through a store, quickly became annoyed. 'When you came in, you saw about 30% of the store was dedicated to Instacart,' Burke said, recalling the stacks of bagged Instacart orders near the front entrance, the two checkout lanes reserved for Instacart purchases and the swarm of 'professional shoppers' hastily grabbing produce or packaged items. Remarkably, Whole Foods reverted back to its old, fancy, non-processed boutique style after Amazon purchased the chain in 2017. Stopping by on a recent Wednesday morning, Burke watched as shoppers aimlessly perused the showcased fruits and vegetables, picking an avocado from a pyramid to check it for bruises. At the bulk bins, a man unhurriedly shoveled pinto beans into a bag. 'Now that,' Burke said, pointing at the bean shoveler, 'is not a professional shopper.' Across the street, the Castro Safeway still gets a lot of walk-up customers, though the store has struggled to retain them. For a while, thefts and street conditions deterred the paying clientele, until Safeway reduced the store's hours and added new security gates in 2021. Now, customers enter through a bullpen: displays of flowers and seasonal fruit form a canyon that funnels people through a one-way turnstile, similar to El Cerrito. Inside, the aisles run uninterrupted end to end, though a clerk said they have been that way for years. Because the store is smaller than its El Cerrito counterpart, it needs a more compact layout. On the aesthetic spectrum of grocery stores, the Castro Safeway is closer to a conventional supermarket than a warehouse. But online orders are clearly a big part of the business. At 11 a.m. on a Wednesday morning, a delivery app worker was making two separate purchases at one of the cashier stands — one order entirely of meat, the other entirely carbohydrates. 'I have noticed a bunch of personal shoppers,' said Brett Thomas, who took the bus to the Castro Safeway because his nearest store closed in the Fillmore. Thomas said he sees bagged orders stowed in Safeway coolers, and occasionally hears calls for pickup over the store's intercom. It all reminds him of the changing times. No one can quite predict the future of grocery shopping, though current models suggest it will be more atomized and depersonalized. More of us, potentially, will be pecking our shopping lists into our phones, and waiting for deliveries from the nearest ghost store. This arrangement will certainly appeal to people who prize convenience and like the idea of tech-based courier service. It could be highly profitable for companies to closely track their customers' purchases. Nonetheless, something will also be lost, Gallino warns. He has a different vision for the supermarkets that continue to thrive five or 10 years from now. A few will move all their infrastructure online. Others will ditch their apps and revive the traditional retail format, allowing people to wander product displays and jostle shopping carts down crowded aisles. The ideal store, as Gallino imagines it, would still be a hive of human activity — not a mothballed staging area.
Fast Company
16-05-2025
- Business
- Fast Company
A massive Stanford WFH study reveals where the policy is popular—and why: Q&A
When Nicholas Bloom, the William Eberle Professor of Economics at Stanford University in California, started studying working from home in 2004, 'it was hard to get anyone engaged,' he says. Even in 2018, 'no one had any interest whatsoever.' In 2025, that's hard to fathom. Between the pandemic and technological advancements, WFH has become a norm among white collar workers. Not only has it normalized; it's also destigmatized. The act that used to generate memes of Homer Simpson on the couch, prodding a distant computer with a stick has gained 'positive connotations,' says Bloom. Working from home is seen as a privilege. It's also here to stay. For their latest study, ' Working from Home in 2025,' Bloom and his collaborators analyzed responses from 16,000 college graduates across 40 countries and discovered that WFH levels appear to have stabilized as of 2025, but its embrace hasn't been universal. WFH rates vary by location: highest in English speaking regions—the U.S., UK, Australia, Canada, New Zealand—the rate dips a little across continental Europe, then dips a lot across Africa and Central and South Americas. WFH is least prevalent in Asia. To be clear, when Bloom says WFH, he's mostly talking about those on hybrid work schedules. 'Sixty percent of people work fully in-person, 30% are hybrid, and 10% are fully remote,' he says of those countries where the policy has stuck. Hybrid typically means Tuesday through Thursdays in the office—a schedule Blooms values at 'about 8% more pay…because it saves two to three hours a week of commuting [and] enables people to live further away' from their offices, often to where real estate is cheaper. Companies also benefit from hybrid policies, Bloom's study found, since fewer employees tend to quit. With all these advantages, you'd think bosses would have embraced WFH worldwide. 'Why on earth does, say, Japan have a third the work from home rates of the U.S.?' Bloom says. After looking at factors including development (Japan is about as developed as the U.S.), population density, industrial structure, and connectivity (no big differences there), it left Bloom and fellow researchers with one notable variable. 'The big factor is cultural,' he says, 'and it's around individualism.' advertisement The final deadline for Fast Company's Brands That Matter Awards is Friday, May 30, at 11:59 p.m. PT. Apply today.
Yahoo
07-03-2025
- Business
- Yahoo
Return-To-Office Mandates Can Cost More For Companies Than Wasted Real Estate
As demand for office space declines, companies are being advised to forgo strict return-to-office (RTO) mandates and instead allocate funds toward creating workplace environments that enhance the employee experience. The recently released McKinsey & Co's Future of the Office report projects that office space demand in major cities will decline by 13% by 2030, putting $800 billion in real estate value at risk. This poses a direct challenge to corporate leaders enforcing RTO policies in response to long-term leases signed before the pandemic, which have since become costly, underutilized real estate expenses. However, Forbes highlighted that this approach overlooks the hidden costs of mandated office returns, which research shows are contributing to decreased productivity, lower employee morale, high turnover rates, and costly talent acquisition. A case study of a professional services firm in New York City illustrated the underlying issue with numbers. A firm with 1,000 employees spends an estimated $18 million annually on real estate. If 50% of employees work remotely, half of that investment — $9 million — becomes a sunk cost. However, a forced RTO policy can result in a conservative 30% turnover rate, and recent research shows that nearly 42% of recent turnovers are attributed to forced RTO policies. With an average salary of $125,000 and a replacement cost of 1.5 times the salary, the economic cost of replacing 300 employees who quit because of rigid RTO mandates would amount to $56.25 million. Research also showed that it took organizations 23% longer to fill positions vacated due to the enforcement of RTO policies. The numbers are far more than the $9 million wasted in real estate. For the corporate leaders who believe in-person workers are more productive, a 2023 study by Stanford University's Nicholas Bloom found that hybrid workers are 9% more productive than those working fully in-office. Additionally, companies that adopt flexible work models report higher employee engagement, which directly correlates with improved business performance. Strict RTO mandates are driving away top talent. A 2023 Gallup survey revealed that 76% of employees would consider quitting if remote work options were taken away. Considering the McKinsey report, the offices of the future must be designed to foster connection, with hybrid and flexible work environments centered around intentional in-person experiences that promote greater innovation and engagement. RELATED CONTENT: How Favoritism Plays A Role In Return-To-Office Mandates, Especially For High Performers
Yahoo
19-02-2025
- Business
- Yahoo
One in three millennials to ignore return-to-office demands
One in three millennials are ignoring return-to-office demands as bosses grow increasingly frustrated over home working, new figures show. A survey of 1,000 staff has found that those born between 1965 and 1980, known as Gen X, were the most willing to comply with return-to-office policies, while millennials – those born between 1981 and 1996 – were the most resistant. The findings revealed that a third of millennials would either disregard requests to return to the office or seek a new job if forced in, according to a survey conducted by TopCV. The findings come as a growing number of chief executives voice their frustration over remote working, which has grown in prominence since the pandemic. A study of US workers published earlier this month by Nicholas Bloom, the Stanford economist, shows that home working has persisted despite the rise in companies demanding staff return to their desks. Jamie Dimon, the head of America's biggest bank JP Morgan, last week railed against staff who work from home in an expletive-laden outburst. 'Don't give me this s--- that work-from-home Friday works,' he said in the leaked recording. 'I call a lot of people on Fridays, and there's not a goddamn person you can get a hold of.' Raising concerns about the 'damage' working from home was doing to young recruits, he then accused managers of abusing the system: 'A lot of you were on the f------ Zoom ... and you were doing the following: looking at your mail, sending texts to each other about what an a------ the other person is, not paying attention, not reading your stuff. 'And if you don't think that slows down efficiency, creativity, creates rudeness – it does. You don't do that in my goddamn meetings.' A number of major businesses have tightened their remote working policies in recent years, including BT and PwC. Advertising giant WPP also launched a fresh crackdown earlier this year, calling on staff to come into the office at least four days a week from April and on at least two Fridays each month. Meanwhile, in America, Trump's decision to order federal employees back to the office full-time has given bosses added motivation to draw a line under remote working. Amazon, Google, Meta and Apple have all clamped down on home working in recent months. Broaden your horizons with award-winning British journalism. Try The Telegraph free for 1 month with unlimited access to our award-winning website, exclusive app, money-saving offers and more.
Telegraph
19-02-2025
- Business
- Telegraph
One in three millennials to ignore return-to-office demands
One in three millennials are ignoring return-to-office demands as bosses grow increasingly frustrated over home working, new figures show. A survey of 1,000 staff has found that those born between 1965 and 1980, known as Gen X, were the most willing to comply with return-to-office policies, while millennials – those born between 1981 and 1996 – were the most resistant. The findings revealed that a third of millennials would either disregard requests to return to the office or seek a new job if forced in, according to a survey conducted by TopCV. The findings come as a growing number of chief executives voice their frustration over remote working, which has grown in prominence since the pandemic. A study of US workers published earlier this month by Nicholas Bloom, the Stanford economist, shows that home working has persisted despite the rise in companies demanding staff return to their desks. Jamie Dimon, the head of America's biggest bank JP Morgan, last week railed against staff who work from home in an expletive-laden outburst. 'Don't give me this s--- that work-from-home Friday works,' he said in the leaked recording. 'I call a lot of people on Fridays, and there's not a goddamn person you can get a hold of.' Raising concerns about the 'damage' working from home was doing to young recruits, he then accused managers of abusing the system: 'A lot of you were on the f------ Zoom ... and you were doing the following: looking at your mail, sending texts to each other about what an a------ the other person is, not paying attention, not reading your stuff. 'And if you don't think that slows down efficiency, creativity, creates rudeness – it does. You don't do that in my goddamn meetings.' A number of major businesses have tightened their remote working policies in recent years, including BT and PwC. Advertising giant WPP also launched a fresh crackdown earlier this year, calling on staff to come into the office at least four days a week from April and on at least two Fridays each month. Meanwhile, in America, Trump's decision to order federal employees back to the office full-time has given bosses added motivation to draw a line under remote working. Amazon, Google, Meta and Apple have all clamped down on home working in recent months.
