Boston Days - Part 12

Leg Godt: How a 94-Year-Old Toy Company Out-Engaged the Smartphone

(I am writing "Boston Days" as a series of articles for quick reference for myself and other retail pilgrims. This article covers what a Harvard classroom, a LEGO store in downtown Boston, and one small race car taught me about customer engagement and repeat business.)

Footfall is rented. Engagement is owned. That is the only difference between a store you visit once and a brand you return to for life.

I had waited forty years for one walk into a LEGO store — to build something with my own hands beside other children, browse every shelf without an agenda, and spend a modest, self-imposed budget down to its last dollar. 

Small ambitions, held for a very long time.

I understood why that wait mattered inside a Harvard classroom, months before Boston. Early on during my Senior Leadership Program, we studied LEGO's turnaround as a case in discipline. 

Founded in 1932 by Ole Kirk Christiansen in Denmark, the company took its name from "leg godt" — play well. 

The interlocking brick arrived in 1958, the minifigure in 1978. Then came theme parks, video games, and licensing deals that nearly buried it — $800 million in debt by 2003. 

A new CEO cut thousands of products, sold the parks, and rebuilt around the brick. 

By 2015, LEGO had overtaken Mattel and Hasbro to become the world's most valuable toy company — still earning over $9 billion a year, as newborns now inherit smartphones before toys.

That paradox pulled me into the LEGO Store in downtown Boston. 

A three-storey brick giraffe named Gio guards the corner, stopping strangers before they step inside — engagement earned on a public sidewalk, for free. 

Inside, a wall traces the company's history, ending on its founding motto: only the best is good enough. 

Nearby sat a bin of loose bricks, no set, no instructions, where I built beside a teenager, a toddler, and a father, united by nothing but the bricks. 

A sign above read "Adults Welcome," and I took that personally.

I browsed every wall, each merchandised as a complete idea, then bought the one thing that mattered — a small LEGO Formula One race car, a nod to three decades watching the sport, and a deliberate choice of Team LEGO over any real one. 

Twenty dollars, two hundred and one pieces, one evening of building I still remember.

A smartphone holds a child's attention for an hour. It cannot hand a stranger a brick and watch two generations finish something together. 

That difference is why LEGO still outsells every screen, ninety-four years on.

Retailers spend fortunes chasing footfall and forget that footfall without engagement never returns. 

LEGO stopped chasing new customers decades ago — it simply gave the ones it had a reason to return, never with a discount, always with a brick placed in the right hand.

Boston was teaching me again — that repeat business is never bought. It is built, one engaged customer at a time.

(I am writing "Boston Days" as a series of articles for quick reference for myself and other retail pilgrims.)

Read Part 1, Part 2, Part 3, Part 4, Part 5, Part 6, Part 7, Part 8, Part 9, Part 10 and Part 11 here.

Boston Days - Part 10

One Store. Two Concepts. A Retail Sangam at Assembly Row.

(I am writing "Boston Days" as a series of articles for quick reference for myself and other retail pilgrims. This article covers the art — and ambition — of co-locating two distinct retail concepts under a single roof.)

There is a phenomenon in nature — and in Indian languages there is a word for it: Sangam. The meeting of rivers. Where two bodies of water converge and yet retain their individual colours, their distinct character, before eventually merging into one. 

Rovers Bhagirathi and Alaknanda meet at Devprayag in the Himalayas — one clear and swift, one jade-green and fuller — visible as separate threads for a stretch before the river earns its most sacred name: River Ganga.

In Africa, the Blue Nile and the White Nile converge at Khartoum, Sudan, the difference in hue unmistakable even from a distance. In Germany, the Rhine and the Moselle meet at Koblenz — the Deutsches Eck — one dark, one lighter, side by side before yielding to each other.

A fellow pilgrim recommended it warmly. Assembly Row, Somerville. The combined TJ Maxx and HomeGoods store. Go, they said. You won't leave easily.

They were right. Wow was my first reaction.

The combined store spans approximately 45,000 square feet — TJ Maxx occupying roughly 28,000 and HomeGoods anchoring the balance. Large enough to disorient first-timers. Purposeful enough to reward the patient.

That is precisely how TJ Maxx and HomeGoods begin and end inside Assembly Row.

TJ Maxx was born in 1976 in Framingham, Massachusetts — an off-price apparel and fashion retailer under the larger TJX Companies umbrella. Today, TJX is a global behemoth with revenues of approximately $54 billion and over 4,900 stores across nine countries. 

TJ Maxx's differentiator is its treasure-hunt model — a curated mix of private labels, select international brands, and opportunistic buys, all at 20 to 60% below traditional retail. What struck me was the dominance of private labels, with a handful of recognisable international names sprinkled strategically through the aisles.

HomeGoods launched in 1992 — also a TJX creation, and a natural evolution of the same off-price philosophy applied to home furnishings, décor, and kitchenware. Its value proposition is sharp: global sourcing, constantly rotating assortment, and price points that make discretionary spending feel responsible. 

Similar concepts operating globally include Burlington in the US, JYSK across Europe, and Next Home in the UK — each anchoring the off-price home segment in their respective markets.

The customer synergies are obvious. The shopper who browses for a discounted jacket is frequently the same person who lingers over a ceramic lamp. The household wallet has multiple compartments — and this store is designed to open all of them in a single visit. 

Like a seasoned relay athlete passing the baton without breaking stride, TJ Maxx hands the customer seamlessly to HomeGoods at an invisible midpoint, the transition so organic it is barely felt.

Back in India, Big Bazaar attempted something similar — fashion and grocery under one roof. It was bold and prescient. But the mood states for clothing and groceries are fundamentally different. 

One is aspiration-driven; the other is need-driven. The shopper's mental wallet rarely visits both categories with equal enthusiasm in the same visit. Fewer takers initially, and eventually, structurally difficult to sustain.

Shoppers Stop and Home Stop represent a closer Indian analogy. Home Stop, a standalone home lifestyle format under the same K Raheja Corp umbrella, never shared a roof with Shoppers Stop to my knowledge — they remained separate standalone stores. 

Home Stop stores have been largely phased out in recent years, further validating how hard this adjacency is to execute profitably. If a combined format exists anywhere today, it is an exception worth investigating, not a pattern.

Three Insights. 

First, shared customer DNA is the strongest argument for co-location — not proximity of product categories. 

Second, the off-price model creates a treasure-hunt psychology that benefits enormously from size and variety, rewarding exploration across both concepts. 

Third, a seamless transition zone between the two concepts — visible but not jarring — is where the real design intelligence lives.

Four Strategies. 

One: anchor each concept with its own identity before inviting the overlap. 

Two: let value, not discount signage, do the emotional heavy lifting. 

Three: invest in sight lines — the HomeGoods world must be visible from deep inside TJ Maxx, creating curiosity. 

Four: train frontline staff to serve both concepts fluently, so the customer never feels handed off, only accompanied.

Five Lessons for Indian Retail Practitioners. 

One: customer synergy must be tested before store design is committed — survey before you sketch. 

Two: the off-price model requires sourcing sophistication that cannot be shortcut; it is a supply chain play first and a retail play second. 

Three: mood-state alignment matters more than category adjacency — Big Bazaar's challenge was mood, not merchandise. 

Four: size is a feature in this format, not a cost — undersizing kills the treasure-hunt. 

Five: in India, where organised retail is still maturing, the combined-concept model demands patience; the payoff is real, but the runway is longer than investors typically allow.

Assembly Row did not just show me two stores. It showed me what retail can be when two well-defined identities trust each other enough to share a roof.

Boston was teaching me. Again.

(I am writing "Boston Days" as a series of articles for quick reference for myself and other retail pilgrims.)

Read Part 1, Part 2, Part 3, Part 4, Part 5, Part 6, Part 7, Part 8 and Part 9 here.

Boston Days — Part 9

The Store That Spoke to Me. After I Had Already Left.

(I am writing “Boston Days” as a series of articles for quick reference for myself and other retail pilgrims. This article covers frontline culture — and what two factory outlets in Somerville taught me in ninety minutes.)

Assembly Row in Somerville is one of Greater Boston’s more interesting retail destinations. Open-air, mixed-use, genuinely alive on a warm August afternoon. I was there for two names: Nike and Puma.

Same street. Same concept. Ninety minutes between them. A very different education.

The Nike Factory Store is impossible to miss. 

Strong footfall. Unmistakable brand energy. Categories demarcated, range broad — everything that a factory outlet of the world’s largest sportswear brand should signal.

But something was off.

Merchandise was scattered. Shelves in various states of undress. Replenishment appeared to be an afterthought. Staff were few and visibly stretched. Customers were entirely on their own — not by design, simply by default.

The billing queue was long. Not the kind of long that means a great trading day. The kind that makes a motivated shopper quietly calculate whether waiting is worth it.

Footfall without conversion is noise. Brand strength got them through the door. What happened inside was another matter entirely.

Across the street stood the Puma Factory Store.

Fewer customers. Calmer energy. But immediately, noticeably different in composition. Staff were present — not just physically, but attending. The floor was managed. The store felt considered.

I spent over thirty minutes inside. Browsing, trying on, thinking. I stepped out without a purchase.

That is when it happened.

A Puma associate walked up — calmly, without rehearsed enthusiasm — and asked a simple question. Had I found what I was looking for?

It was an unremarkable interaction on the surface. Except it hadn’t happened inside Nike. And it happened here, after I had already left.

Someone had noticed that a person spent thirty minutes inside, walked out without buying, and was carrying unresolved intent. That is not a trained reflex. That is a culture.

A few kilometres away, inside an HBS classroom, I had spent an entire session the previous week discussing the Walmart case. 

Doug McMillon’s conviction — that Walmart’s greatest long-term competitive asset was its people — had generated sharp debate. His bets on frontline dignity and training were not HR policy. They were strategic capital allocation.

Standing on that Somerville sidewalk, I had just watched the same case play out. Not in a classroom. In real life.

One store had the crowd. The other had the conversation.

Ninety minutes at Assembly Row. No slides. 

No framework. Just one street, two stores, and a reminder that the greatest competitive advantage in retail has always been the person standing closest to the customer.

Boston was teaching me. Just not always inside a classroom.

(I am writing “Boston Days” as a series of articles for quick reference for myself and other retail pilgrims.)

Read Part 1, Part 2, Part 3, Part 4, Part 5, Part 6, Part 7, Part 8 and Part 9 here.

Boston Days - Part 8

The Man Who Saved Best Buy Walked Into My Classroom Today.

(I am writing “Boston Days” as a series of articles for quick reference for myself and other retail pilgrims. This article covers “Culture as Strategy — a Leadership Class with Hubert Joly”)

There is a specific kind of pause that happens inside you when you register, fully and without warning, who exactly is standing at the front of the room.

It happened to me this morning at HBS.

The professor for today’s session was Hubert Joly. Former chairman and CEO of Best Buy. 

The man who walked into arguably the most distressed large-format retail situation in modern American business — stock at $11, market cap at $4 billion, Amazon at its most predatory — and rebuilt it by asking one question almost no CEO was asking at the time: what is this company actually for?

I have spent three decades watching Indian retail. One hundred plus cities. Every format from airport terminal to neighbourhood kirana. 

And yet, sitting in that classroom this morning, I had to consciously remind myself to take notes rather than simply listen.

The session was built around two cases. Nvidia. Walmart.

The Nvidia case was not primarily a technology story. At its core, it was a study in Jensen Huang’s deeply personal leadership style — his instinct for flat structures, radical transparency, and a culture where the fear of embarrassment is replaced entirely by the fear of missing a consequential idea. 

Every person in the room left understanding that Nvidia’s extraordinary run cannot be separated from who Huang is as a human being, and how that humanity travels through fifty thousand people. Strategy, in his hands, is inseparable from character.

The Walmart case landed differently, and with equal force. The discussion centred on Doug McMillon’s fundamental conviction that Walmart’s greatest long-term competitive asset is not its logistics network or its store footprint — it is its people. 

His big bets on workforce investment, wage floors, training and dignity are not HR policy. 

They are strategic bets made with the same rigour a CFO applies to capital allocation. McMillon has simply decided that people are the capital.

The thread connecting both cases — and the man teaching them — was impossible to miss.

Culture is not a consequence of strategy. It is the strategy.

What I carried out of that room was not a framework. It was a reckoning.

Thirty years in retail. Thousands of hours on floors and in boardrooms. Have I always been as deliberate about culture as I have been about category, format and footfall?

The man who walked into Best Buy in 2012 — when people around him said he was either crazy or suicidal — did not walk in with a better product or a superior balance sheet. 

He walked in with a clearer answer to that question than anyone else in the building.

As it turns out, that is not a small thing.

It is everything.

(I am writing “Boston Days” as a series of articles for quick reference for myself and other retail pilgrims.)

Read Part 1, Part 2, Part 3, Part 4, Part 5, Part 6, Part 7, Part 8 and Part 9 here.

Boston Days - Part 7

Is CVS a Pharmacy? A Toy Store? A Convenience Store? Yes.

(I am writing “Boston Days” as a series of articles for quick reference for myself and other retail pilgrims. This article covers the “Positioning” of a Retailer) 

After pondering for several minutes, reading the name printed on every miniature car, I picked up three — all American icons.

A Ford, a Chevrolet, and a DHL pickup truck that has moved American commerce and economy since 1969. Three satisfying finds.

I placed them on the counter and looked up. The backlit signage above the cashier read: CVS Pharmacy. I had just spent ten unhurried minutes choosing toy cars inside a pharmacy.

What exactly is this place? Pharmacy, convenience store, seasonal gift shop, beauty destination, or a toy aisle with a dispensing counter? Walking through CVS, the answer changes with every aisle.

CVS was born in 1963 as Consumer Value Stores in Lowell, Massachusetts. Today it operates roughly 9,000 stores across the United States, present in 3,486 cities nationwide.

Applying a Pareto lens, New York leads with 183 stores. Houston follows with 119, Los Angeles 105, Chicago 73, Philadelphia 63. Dense urban concentration — by strategy, not accident.

Each store typically occupies around 4,000 square feet in dense urban neighbourhoods. Large enough to carry pharmacy, merchandise, beauty, food, seasonal gifting, and apparently, a very respectable toy section.

For readers in India, here is essential context. Most Americans pay little or nothing at the pharmacy counter — their health insurance, managed by intermediaries called PBMs, pays instead.

PBM stands for Pharmacy Benefit Manager — a powerful third party sitting between insurer, drug manufacturer, and pharmacy. It determines exactly how much the pharmacy gets reimbursed for every prescription dispensed.

Reimbursement rates have fallen relentlessly for over a decade. CVS’s pharmacy segment operating margin compressed from 9.9% in 2015 to just 3.5% today, on revenues of $139.4 billion. The arithmetic is punishing.

Walgreens, CVS’s closest comparable, ran a negative 5% operating margin on US pharmacy retail before being taken private by Sycamore Partners in 2025. The industry’s economics are structurally broken.

Which brings us back to the toy cars. The prescription customer walks in, hands over their insurance card, pays a nominal copay or sometimes nothing at all, and waits.

CVS needs that customer to also pick up candy, a greeting card, or three miniature diecast cars. Front store margins are meaningfully better than anything earned from a reimbursed prescription.

The business model, stripped to its core, is converting compulsory prescription footfall into discretionary front-store revenue. It is not irrational thinking. It is, in fact, survival thinking.

Except the consumer has not fully cooperated. CVS’s front store same-store sales declined 2.1% in 2024, recovering to just 1.2% in 2025. Customers tolerate the format. They do not embrace it.

The result is a retail identity no shopper can define in one sentence. A pharmacy barely profiting from prescriptions it fills, surrounded by merchandise it hopes will subsidise the enterprise.

The DHL truck, the Ford and the Chevrolet sit on my desk here in Boston. Charming mementos of a pharmacy still searching, with some urgency, for its own positioning clarity.

(I am writing “Boston Days” as a series of articles for quick reference for myself and other retail pilgrims.) 

Read Part 1, Part 2, Part 3, Part 4, Part 5, Part 6, Part 7, Part 8 and Part 9 here.