TIME Brands

Fast-Fashion Apparel Giant H&M Opening More Stores as Profit Soars

Shoppers And Retail Economy As German Investor Confidence Jumps
Pedestrians carry Hennes & Mauritz AB (H&M) branded shopping bags in Mannheim, Germany, on Tuesday, Jan. 20, 2015. Bloomberg—Getty Images

Swedish retailer says its profit leapt 17% in 2014, plans 400 new stores

Hennes & Mauritz AB, more commonly known as H&M, has announced plans to open 400 new stores in 2015, a move that comes after the Swedish retailer reported profit leapt 17% for the latest year. Here are the most important points from the retailer’s latest earnings report.

What you need to know: H&M, a major powerhouse in the world of retail, is accelerating store opening plans in 2015 and intends to open an additional 400 stores on top of the 3,511 locations it already operates. In 2014, H&M opened 379 new stores. The new store openings for this year will mostly occur in China and the U.S., although H&M said it will debut in several new markets this year, including South Africa, India, and Peru.

The U.S. is the company’s second-largest sales market after Germany, and an important growth market. H&M opened 51 stores in the U.S. last year — that’s more than any other market outside China, where 86 stores were added. Sales in the U.S. leapt 26%, among the better-performing markets for the year ending on Nov. 30, although H&M’s sales grew broadly across all major markets.

H&M is a fast-fashion purveyor that turns around trend designs quickly, taking away business from teen-focused retailers and other rivals that take a longer time to respond. Sales growth in the U.S. has far outpaced those reported by Gap, for example, while teen retailers such as Abercrombie & Fitch have seen their businesses suffer a bruising decline as tastes have changed in favor of H&M and rival Forever 21.

The big number: Profit for the full year after taxes totaled 19.98 billion Swedish kroner ($2.4 billion in U.S. currency), up 17% from a year ago. H&M gave an early indication that sales growth will continue to remain strong early in 2015, with sales up 15% in December and expected to rise 14% in January.

What you might have missed: H&M also unveiled a plan to launch a new beauty concept with an initial debut in about 900 stores and online beginning this fall. The new concept will comprise of a range of make-up, body care, and hair care items, and will replace H&M’s current own-brand cosmetics line. H&M didn’t say much about the line, or why it was changing its strategy in beauty, although the move is the latest step by the apparel chain to diversify its product range.

H&M last year debuted a sport-focused line, and also expanded the amount of shoes it sold in some of its stores. Sportswear, which has been an increasingly popular apparel trend that has boosted results for Nike and Under Armour in the U.S., has lured H&M, Forever 21, and other rivals that haven’t traditionally focused on that category. For example, H&M’s U.S. online store lists 124 items for women under sportswear, selling a range of clothes meant for the gym or even to be worn more casually, and not necessarily for athletic purposes. That’s a dominant trend in retail today, as yoga pants take the place of jeans for everyday wear (in one of many examples).

This article originally appeared on Fortune.com.

TIME Brands

Yahoo to Spin Off Alibaba Stake

Deal would let the Internet portal cash in on its stake while paying minimal taxes

Yahoo plans to spin-off its multi-billion dollar stake in Chinese e-commerce giant Alibaba into a separate company in an effort to cash in on its investment in the company tax-free.

The proposed transaction, which Mayer released today in conjunction with Yahoo’s fourth quarter earnings, will create an independent company called SpinCo. This publicly traded entity will absorb all of Yahoo’s 384 million Alibaba shares, worth $40 billion. Those shares will then be distributed to Yahoo’s investors.

The move comes amid pressure on Yahoo by activist shareholder Starboard Value to sell the Alibaba stake while paying minimal taxes.

When Alibaba went public last September, it marked the largest IPO of all time. Yahoo sold $9.4 billion worth of Alibaba shares in the IPO. Since then, Yahoo shareholders have argued that the company’s stake in Alibaba is worth more than Yahoo itself.

Since taking the CEO job over two years ago, Marissa Mayer has coasted on Yahoo’s fortuitous early investment in Alibaba. The company has returned $9.7 billion in proceeds from that investment through share repurchases. After this spin-off, that figure will total $50 billion. “This level of capital return is historic, especially for a company of our size,” Mayer said in a statement.

In the release, she touted the expertise of Yahoo’s tax lawyers in executing the complex transaction.

SpinCo will own a 15.4% stake in Alibaba.

This article originally appeared on Fortune.com.

TIME Brands

There’s Still Time to Get Your Free Burrito from Chipotle Today

Restaurant Chain Chipotle Warns Climate Change Could Force Guacamole Off The Menu
A Chipotle restaurant is seen on March 5, 2014 in Miami, Florida. Joe Raedle—Getty Images

But you have to order their "sofritas" first

Chipotle really, really wants you to try its new tofu.

On Monday, Jan. 26th, the Mexican chain is offering free food for customers who order their new organic tofu Sofritas. Here’s the deal: All you have to do is buy one of their entrees made with the vegan-friendly protein today, bring your receipt back to any Chipotle location from Jan. 27 through Feb. 15 and you’ll get a free burrito, burrito bowl, salad or tacos.

It’s basically a buy-one, get-one-free kind of thing — but, hey, a free burrito is a free burrito no matter when you redeem it.

So what exactly are you buying in order to get that free size-of-a-small-baby burrito? In Chipotle’s own words, Sofritas are made “organic tofu from Hodo Soy that we shred and then braise with chipotle chilis, roasted poblanos, and a blend of aromatic spices. The result is a delicious, spicy tofu that will give vegans and carnivores something they both will love.”

Keep in mind that should you dislike Sofritas, you can use your next-time “freebie” for anything on the menu — if supplies are still in store. (Those deliciously spicy carnitas are still off the menu at about a third of Chipotle’s locations.)

This article originally appeared on People.com.

TIME Aviation

Why Airlines Don’t Talk About Safety In Their Ads

Airport
People stand in the main terminal at Washington Dulles International Airport is shown October 2, 2014 in Dulles, Virginia. Mark Wilson—Getty Images

Fliers don't want to be reminded of the risk

Looking around at modern airlines’ slogans, you might notice a common trend: Few of them stress safety. Not Delta’s “Keep Climbing,” not American Airlines’ “The new American is arriving,” not JetBlue’s “You Above All.”

There was a time when this wasn’t the case. Safety was often mentioned in air travel ads when the aviation industry was still nascent in the 1920s and 1930s — back then, airlines had the tricky task of convincing travelers to try a then-unproven means of getting about.

The trend lasted until the late 1980s, when Pan Am launched reassuring ads amidst terrorist threats targeting American airliners flying across the Atlantic. Those threats, however, eventually took form as that year’s fatal bombing of Pan Am Flight 1o3, which claimed 270 lives in the air and on the ground.

The Pan Am attack, says aviation security expert Glen Winn, is ultimately what convinced airlines to quit bragging about safety.

“Leading up the destruction of Pan Am 103, [Pan Am] had advertised themselves as not only the safest, but also the most secure,” Winn said. “Airlines since then have been really careful how they say what they say.”

Safety has since all but disappeared from airlines’ advertisements. And when airlines are required to discuss safety during on-board safety demonstrations, major brands are trying to make them more fun, revamping their in-flight safety videos to transform mandatory prepare-for-the-worst briefings into informative musicals and short films.

Why the shift? Yes, Worldwide commercial aviation deaths per year have declined. But no airline can guarantee passengers total immunity from harm. And several high-profile disasters over the past few months, like Malaysia Airlines Flights 370 and 17 as well as AirAsia Flight 8501, have put travelers especially on edge. Putting the “S-Word” in slogans or commercials, airlines have found, doesn’t reassure passengers — it just reminds them of the random chance of danger their next trip might bring, however slight it may be.

“When you talk about safety, you bring up a bad taste in people’s mouths,” said Andy Trinchero, executive director of marketing at aviation marketing firm. “It’s something that people don’t even want to hear about, really.”

TIME Brands

One of the Last Marlboro Men Has Died

Darrell Hugh Winfield was discovered while working on a ranch in Wyoming

One of the last Marlboro Men died earlier this week.

85-year-old Darrell Hugh Winfield passed away Monday at his home in Riverton, Wyoming, the Associated Press reported.

Winfield, discovered by ad agency Leo Burnett in 1968 while working on a ranch, was the quintessential macho cowboy — a quality that made him one of the rugged faces of the cigarette company between the late 1960s and the late 1980s.

The Marlboro Man was first introduced in the 1950s in an attempt to sell filtered cigarettes to men. They had previously been targeted at women.

[AP]

TIME Internet

Twitter Account to Overly Thirsty Brands: Stop Saying the Word ‘Bae’

Social Media Site Twitter Debuts On The New York Stock Exchange
Bethany Clarke—Getty Images

A valiant effort to shame companies trying way too hard to sound like teenagers

The thing about brands on Twitter is that they want you to forget that they’re brands. They want you to think of them as your quippy, sassy ol’ pals who occasionally sell you products you probably don’t need.

Most of us Internet dwellers, however, see right through these brands’ tactics — and a new Twitter feed aims to call them out for it.

The account is called “Brands Saying Bae” — so, as you can imagine, it pokes fun specifically at companies using the word “bae.” (If you don’t hang out with teenagers, “bae” is a slang word many of them like to use as a term of endearment. The Wall Street Journal also adds the following analysis: “Bae can be aspirational — someone of romantic interest. The term has also inevitably evolved to apply to inanimate objects. On Instagram, a particularly mouthwatering plate of BBQ could be #bae, for example.”)

So, naturally, tons of brands — from Burger King to Walmart to Gain — have begun incorporating this slang word into their tweets. Here are some examples from Brands Saying Bae, along with plenty of tongue-in-cheek commentary:

To whoever runs this Twitter account: Thank you, and keep on fighting the good fight.

TIME Companies

Nike Exec Leaves the Company Because He Hates Portland

"It was a culture shock"

The dream of the ’90’s may be alive in Portland, but for Nike’s rising star chief information officer, it wasn’t worth dreaming.

Anthony Watson announced he was quitting the Oregon-based company on Wednesday, citing “personal reasons.” But Fortune, citing an unnamed source close to him, reports the real reason for his departure is that he found just found Portland to be too boring “As a single gay guy from London,” the source said, he “underestimated what it would be like. It was a culture shock.”

Read more at Fortune

MONEY consumer psychology

Why JetBlue Can Break Your Heart, but Comcast Never Will

JetBlue Planes
Seth Wenig—AP

It hurts to find out that brands like JetBlue want you to love them—but they only love you for your money.

This week, JetBlue announced it’s adding more seats on planes and new fees for checked baggage. The moves are clearly aimed at hiking profits—which is what businesses are supposed to do, right?

So why, then, has JetBlue’s policy change been met with outrage and a sense of betrayal? Isn’t JetBlue just a business that’s, you know, in the business of making money? Shouldn’t we fully expect these kind of profit-first policies? And if this kind of behavior is to be expected, why would there ever be any sense of surprise or disappointment, let alone heartbreak?

The subject brings to mind the old fable “The Farmer and the Viper,” in which a farmer nurses a freezing snake back to health—and is then promptly bitten and killed by the snake as soon as it has the opportunity. The moral is that you shouldn’t be surprised, and you certainly shouldn’t feel betrayed, when a snake behaves like a snake. A similar takeaway comes from the disturbing 2005 documentary “Grizzly Man,” which tells the tale of a man and his girlfriend who were killed, in essence, because a bear behaved like a bear.

The complication is that consumers don’t necessarily view brands that we interact with regularly as animals that will take advantage of us whenever the opportunity arises. We’re encouraged to “like” brands on Facebook, and marketers spend billions to try to get us to love brands, ideally with a cult-like fervor. We tend to view favorite brands as trusted partners or even friends, and we can feel violated and betrayed to the core when the terms of what can be a very warm partnership are exposed as more “strictly business,” to quote The Godfather.

“Some brands are so good at connecting with consumers on an emotional level that the relationship feels incredibly personal, much like a friendship,” explains Kit Yarrow, consumer psychologist and TIME and MONEY contributor. “In most cases the consumers feel they share the same values as the brand, which they see as manifesting human characteristics.”

This certainly seems the case for JetBlue and its longtime customers. The brand resonated and indeed became beloved because of the perks (free TVs and snacks for everyone) and amenities (leather seats and plenty of legroom all around) as much as because of its overriding ethos that all customers were valued—and valued equally. What helped make JetBlue stand out and become an industry darling is that its competitors in the airline business are notorious for exceptionally poor customer service, especially in regards to passengers who are paying the least for their flights.

Slowly, though, JetBlue tweaked its business model—adding a business class and adding more fees recently—and with this week’s announcement about shrinking legroom and the addition of baggage fees, it’s clear that the values originally embraced by the brand have changed as well. For the people who loved and were loyal to JetBlue specifically because of its egalitarian, customers-first approach, the latest moves serve as a big slap in the face with the cold-hearted reality that shouldn’t really come as a surprise, but hurts nonetheless: Brands like JetBlue want you to love them, but they only love you for your money.

Experts who study marketing and company-consumer relationships believe that brands that have developed cult-like followings for supposedly doing things the right and honorable way—Chipotle and Whole Foods come to mind—are likely to feel greater backlash if and when they appear to violate customers’ trust. “Our theory is that the people who feel most betrayed are the ones who were most attached to the brand in the first place,” says Debbie MacInnis, a marketing professor at the USC Marshall School of Business who is researching brand betrayal with colleagues.

By and large, consumers tend to get most attached to scrappy smaller brands with a streak of independence—brands they can identify with and feel good about supporting. “We love underdog stories,” says MacInnis. “We see ourselves as underdogs. We love the little guy, so there’s a natural brand connection.” It’s a connection that goes beyond a mere mutually beneficial economic transaction.

On the other hand, brands that are monolithic and fail to develop long-lasting loyalty or affection—big banks, pay TV and wireless providers, and yes, airlines come to mind—are less at risk of betraying customers’ trust because there was little to no trust to begin with. “You’re not likely to feel betrayed when a cable company treats you poorly,” says MacInnis. “You’ll shake it off and jump” to a competitor without blinking (assuming another one is actually available). “The transgressions are par for the course.”

It’s all about expectations: When someone we thought of as a friend turns out to be just another snake, it’s heartbreaking. Hence, the presence of several “Et Tu, JetBlue?” headlines out there, indicating that the once beloved airline’s betrayal is one of epic proportions.

“When consumers sense they’ve been used or manipulated they feel a burn more similar to a human betrayal than simple transactional disappointment,” says Yarrow. However, bigger, widely bashed brands are “lucky” enough to disappoint customers so frequently that there’s no surprise or sense of betrayal when they make yet another profit-first, customer-unfriendly move. “Consumers have such low expectations of Comcast, for example, they are thrilled when there simply aren’t problems.”

MONEY groceries

Lawsuit Could Force Upstart Condiment Brand to Hold the ‘Mayo’

141111_EM_JustMayo
In a lawsuit, food giant Unilever says that Just Mayo must change its labeling because it is not real mayonnaise. Jim Wilson—The New York Times/Redux

In a David vs. Goliath battle over sandwich spread labeling, things could get messy.

Unilever, the food giant that owns the Hellmann’s brand of Real Mayonnaise, recently filed a lawsuit against Hampton Creek, a well-funded startup backed by the likes of Bill Gates. The upstart company is being accused of false advertising because its sandwich spread brand Just Mayo contains no eggs and is therefore not real mayonnaise.

The Food & Drug Administration stipulates that any product calling itself mayonnaise must contain one or more “egg yolk-containing ingredients,” and Just Mayo is made with yellow peas instead of eggs. The rules also require genuine mayonnaise to be at least 65% vegetable oil—which is why Kraft’s Miracle Whip, which doesn’t meet that standard, is not a mayonnaise and is technically classified as a salad dressing.

Unilever is demanding that Just Mayo change its labels, and it is seeking unspecified compensatory damages. The “harm is impossible to quantify because of the difficulty of measuring lost good will and sales” for Hellmann’s and other mayonnaise makers, the suit states. The suit claims that the “Just Mayo false name” has “caused consumer deception and serious, irreparable harm to Unilever,” and that it’s “part of a larger campaign and pattern of unfair competition by Hampton Creek to falsely promote Just Mayo spread as tasting better than, and being superior to, Best Foods and Hellmann’s mayonnaise.”

On its website, Just Mayo states its spread is “outrageously delicious, better for your body, for your wallet, and for the planet.” In recent months, the product—which is vegan but isn’t marketed overtly as such—has appeared on the shelves of national retailers such as Whole Foods, Costco, and Walmart.

Putting taste aside because that’s a subjective matter, how can Just Mayo label itself mayonnaise when it’s not mayonnaise? Well, actually Just Mayo never says that it is mayonnaise. The product is always referred to as “mayo,” not “mayonnaise.” Hampton Creek maintains that there’s a difference, that it never claimed the product was genuine mayonnaise, and that the lawsuit is the result of Unilever and Hellmann’s feeling threatened in the marketplace. “We’re competing directly with a company that hasn’t had real competition in decades,” Hampton Creek CEO Josh Tetrick told the Wall Street Journal. “These things happen.”

Andrew Zimmern, the celebrity chef and Travel Channel personality who is quoted calling Just Mayo a “must have” on the Hampton Creek website, has created a Change.org petition against Big Mayo, asking others to join his effort to get Unilever to “Stop Bullying Sustainable Food Companies.” The online petition, which urges Unilever to drop the lawsuit and “focus more on creating a better world rather than preventing others from trying to do so,” has already registered more than 15,000 signatures. Look for the movement to spread.

TIME interactive

Are You a J. Crew Democrat or a Pizza Hut Republican?

Check out this chart and search tool to see the political leanings of the places that Starbucks, Walmart, and 2,700 other companies call home

If you live near a Ben & Jerry’s or a few Dunkin’ Donuts outposts, odds are good that your Congressional district elected a Democrat on Tuesday. More familiar with the inside of a Pizza Hut or a Long John Silver’s? Chances are you’ll be represented next year by a Republican.

The following chart places 49 common brands on a political spectrum based on the percentage of their brick-and-mortar stores that are located in Democratic or Republican districts. To do this, TIME matched nearly 2 million store locations provided by the research company AggData to their corresponding Congressional district and then tallied them by that district’s vote in 2014 midterms. Of the 139 American Apparel stores, for example, 83 percent are in blue districts. Nearly nine in 10 Belk department stores, meanwhile, can be found in red districts. All the other brands on the chart fall somewhere in between. You can look for any store you like in the search tool below the graphic.

There is no evidence, of course, that a regular infusion of banana ice cream and fudge chunks inspires a person toward liberalism. Because two-thirds of the Ben & Jerry’s in the United States are found in Democratic districts, however, the mere presence of a store in a district raises the statistical odds that its residents are people who vote for Democrats.

While stores like Whole Foods or Hobby Lobby might already conjure partisan stereotypes, the vast majority of America’s brands do not. Even so, where these stores are located tells us a tremendous amount about who their shoppers are sending to Washington.

Methodology

The list of retail locations was provided by AggData. Stores were matched to Congressional district by comparing their longitude and latitude to the Census definitions of districts. The results do not include the 14 Congressional races that have yet to be resolved as of 6:00 AM on Nov. 6, 2014.

Read next: How the World Sees America Now

Correction: The interactive chart originally linked the incorrect record for Armani Exchange when the user clicked the icon in the chart. It has since been updated.

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