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    Published on: December 2, 2005

    The American Beverage Association (ABA) has funded and released a study saying that there has been “a sharp decline in school purchases of full-calorie carbonated soft drinks (CSDs) from 2002 to 2004. The study also showed that average purchases of full-calorie CSDs at school by American students during school hours were extremely low in 2004” – down by 24 percent during the past two years, while purchases of waters increased by 23 percent, diet soft drinks by 22 percent, 100 percent juices by 15 percent and sports drinks by 70 percent.

    The study, according to ABA, concludes “that purchases of full-calorie CSDs during normal school hours averaged about one 12 ounce can per week for high school students. These estimates were conservatively calculated and likely overstate student purchase levels.”

    Susan Neely, ABA president/CEO, released a statement: “This study confirms what previous studies have shown - that consumption of full calorie CSDs purchased from school vending machines during normal school hours is a very minor source of calories in the diets of American youth and is not contributing measurably to obesity rates in the school-age population.”

    The release of the study comes as there have been numerous reports of a spate of lawsuits expected to be filed against soft drink companies, using tobacco litigation as a model in holding the companies responsible for the nation’s obesity crisis.
    KC's View:
    Forget about whether or not soft drink companies have any culpability in the obesity crisis.

    We’re confused about whether this study is about all soft drink consumption, or just vending machine soft drink consumption in schools. Because they’re not necessarily the same thing.

    We also think that maybe the ABA is stretching credibility with this “conservatively calculated and likely overstate student purchase levels” stuff.

    But the best reaction was that of the Content Kids (a 16-year-old boy and an 11-year-old girl) when we told them of this study’s results.

    They snorted.

    Published on: December 2, 2005

    The Organic Trade Association (OTA) has released a new survey predicting where the organic industry will be two decades from now.

    Among the predictions:

    • The organic industry can be expected to continue to grow and thrive at a sturdy rate over the next 20 years, but at a slower pace than the current 20 percent average annual growth in sales.

    • By 2005, 14 percent of the average U.S. household's budget will be devoted to purchasing organic products.

    • The average consumer household in 2025 will buy organic products on a regular basis. These will include food items as well as organic clothing, household cleaning products, and personal care items.

    • Organic products by 2025 will be sold anywhere and everywhere. Increased sales in restaurants can be expected. Increases in organic sales and acceptance will result in increased U.S. organic acreage.

    • Younger shoppers will continue to be interested in organic foods, particularly as Gen Xers pass down their belief systems. Ethnic shoppers, including Asian Americans and Hispanic Americans, will continue to be more likely to buy organic products in proportion to their representation in the general population.

    • In 2025, organic meat, dairy products, alcohol, and "stage of life" foods (those consumed during pregnancy, nursing, infancy, puberty, and senior years) will be most popular, according to survey respondents.

    • Among the challenges cited by survey respondents were consumer confusion about definitions around the organic labels, unbalanced governmental support and promotion of conventional farming methods at the expense of organic agriculture, and the acceptance of the value of organic packaged products versus perishables in the marketplace.
    KC's View:
    One has to take in account that the folks predicting a rosy future for the organics industry happen to have an investment is seeing things go well – they’re all in the business.

    This isn’t the OTA preaching to the choir. It is more like the choir doing the preaching.

    That said, though, we think that these predictions seem relatively safe.

    Published on: December 2, 2005

    Retail Forward says that its Future Spending Index suggests that December should be a good month – the December index comes in at 97.3, up from 96.8 in November and the highest level since September. The index showed increases in up-market and down-market households, with only “modest” slippage for middle-market homes.

    "The key underlying theme in this month's results is the sustained recovery in job security from the hurricane-induced jitters," said Steve Spiwak, an economist with Retail Forward. "That positive trend means retailers can expect shoppers to continue opening their wallets during the all-important December shopping month."

    Shoppers plan to spend $671 on average during the holidays, according to Retail Forward.
    KC's View:
    We don’t mean to be cynical on this issue, but…

    If spending expectations didn’t go up in December, wouldn’t that mean that we’d be in, like, a new Great Depression?

    Published on: December 2, 2005

    The Washington Post reports on how electronics retailers are reaching out to women consumers, hoping to expand beyond the male shopper base that traditionally has driven the category. Apparently it is a matter of coming up with a sales staff that is in touch with what women want, redecorating the store so that the color scheme is more pleasing to a feminine mindset, and trying to be more cognizant of style issues that appeal to women.

    Mary Lou Quinlan, author of "Just Ask A Woman -- Cracking the Code of What Women Want and How They Buy,” tells the Post, "Guys walk around tech stores like they're in a porno shop looking for the fastest, newest, coolest, first-on-the-block thing, while women would rather shop in a calmer, information-based environment for products that will simplify their lives.”
    KC's View:
    While we agree with the notion that stores have to adjust their approaches in order to appeal to people with different demographics and psychographics, there’s something about this story – probably the clichéd characterizations - that we find mildly offensive.

    We happen to be male, and not only have we never cruised an electronics store like it is a porn shop, but we always look for easy-to-use products that have clear applicability. There’s no time for anything else.

    Not only that, but we know plenty of women who are far more into gadgets for gadgets’ sake than we are.

    Targeted marketing is eminently sensible. But human targets, unlike the kind that hang on walls or trees, are rarely like neatly drawn concentric circles that are easy to define and aim at. They are far more complicated, require far greater insight, and are much more complicated to hit.

    Though the rewards, when successful, can be significant.

    Published on: December 2, 2005

    HealthDay News reports that a new study by Innsbruck Medical University suggests that two cups of coffee can improve short-term memory function.

    The report suggests that among the functions that are improved by two cups of coffee are the ability to prioritize, plan new tasks, and deal with stored information.

    Researchers, however, emphasize that three cups of coffee aren’t necessarily better than two, and that there is a point of diminishing returns.
    KC's View:
    Huh?

    Published on: December 2, 2005

    Following a report in a London newspaper suggesting that Tesco CEO Sir Terry Leahy planned to leave the company, attributing the report to a “high level source close to the Tesco board,” the company responded with two words: “Complete nonsense.”
    KC's View:

    Published on: December 2, 2005

    The Los Angeles Times reports that a US Appeals Court has ruled that an antitrust suit filed by state Attorney General Bill Lockyer against Safeway, Albertsons and Kroger can proceed.

    The suit alleges that a “share the pain” agreement among the three chains, which kept any one of them from benefiting at the expense of the others during the four month grocery strike of late 2003 and early 2004, was actually in violation of antitrust law.

    The chains looked to get the case dismissed, saying that their deal was protected by labor law. But the US 9th Circuit Court of Appeals disagreed.
    KC's View:

    Published on: December 2, 2005

    In assessing the Grocery Manufacturers Association (GMA) “Future of Food” conference held this week in Washington, DC, Advertising Age summed it up this way: “After nearly a decade of grappling with the need for more-healthful offerings, food-industry executives…seem no closer to a solution.”

    Which may not be exactly what GMA wanted to hear.

    Ad Age noted that while technology and biotechnology will help companies create foods that taste good, are convenient and nutritious, there was a sense that corporate managements may not always be receptive to such innovations because development tends to be expensive – and it is harder to sell higher priced items to consumers.

    And much of the blame for this problem was laid at the feet of shoppers.

    Lamar Johnson, a veteran food developer who left General Mills to join Bush Brothers as director of product development, “lamented that despite all the hype about health, ‘the majority of consumers have not grasped what it means to lead a healthier lifestyle, which makes it hard to justify development of healthier products as a profitable endeavor,’” Ad Age wrote.
    KC's View:
    Maybe it isn’t a question of consumers not buying into nutrition/health obesity concerns.

    Maybe the industry just hasn’t sold these concerns right. Maybe the industry hasn’t communicated about them in an effective fashion. Maybe…just maybe…the food industry has been so busy serving as a conduit for products that it has forgotten its responsibility to be the agent for the consumer, and be not just a source of product, but a resource for information.

    Maybe.

    Published on: December 2, 2005

    • Wal-Mart is petitioning the Indian government to allow it to open a Sam’s Club there, on the grounds that if Metro – a German company – can open a new cash and carry store there, Wal-Mart ought to be given the same permission.

    Published reports say that there is no clear reason why metro was granted permission and Wal-Mart wasn’t, except that Indian rules governing foreign investment are neither specific nor sophisticated.
    KC's View:

    Published on: December 2, 2005

    • The Seattle Post-Intelligencer reports that arguments have begun in Washington State in a case where Costco is challenging the state government’s regulations for distributing beer and wine.

    Costco maintains that state regulations essentially restrain trade by preventing retailers from negotiating directly with out-of-0state wineries, instead requiring them to deal with in-state distributors.

    • The US Department of the Treasury said that it will begin distribution of a newly designed $10 bill – more colorful (with red, yellow and orange highlights), and with security features that prevent counterfeiting – next March 2.

    • French retailer Carrefour announced that it will expand its private label offerings, bringing out 2,000 new own-label SKUs during the next 24 months. Not a bad move, considering that the company says that 90 percent of its customers buy private label items, and that own-label accounts for 25 percent of total sales.

    • The Wall Street Journal reported the other day about the newest innovation in in-store kiosks – GE’s consumer finance division is putting them in IKEA stores, allowing people to apply for and get credit cards in just a few minutes. Shoppers get credit certificates on the spot, and then an IKEA-branded credit card a few days later in the mail. The system is similar to one being tested by Wal-Mart.

    • Aeon, the Japanese retailer, is testing the use of a four-foot-high robot made by Fujitsu to escort customers to specific locations or carry their grocery bags, according to a report by PlanetRetail.net. The robot gets its instructions via a voice recognition system, though consumer also can use a touch panel.

    The company will reportedly test the robot for three weeks before deciding whether to roll it out to other stores.
    KC's View:
    No name for the robot has been identified in the press. Though we vote for “Data.”

    Published on: December 2, 2005

    • Target Corporation reported that its November sales increased 9.1 percent to $4.583 billion from $4.203 billion a year ago. Same-store sales were up 2.6 percent.

    • BJ's Wholesale Club reported November 2005 sales increased by 5.3% to $621.8 million from $590.6 million in November 2004. Same-store sales were up 1.8 percent.

    • CVS reported that its November sales increased 9.3 percent to $2.9 billion, from $2.6 billion during the same month a year ago. Same-store sales for the period were up seven percent.

    • Longs Drug Stores reported November sales of $354.1 million, up 1.5 percent from the same period a year ago. Same store sales were up a percentage point.
    KC's View:

    Published on: December 2, 2005

    • The Wall Street Journal reports that John R. Alm, CEO of Coca-Cola Enterprises, has reached a “mutual agreement” with the company to resign. No permanent successor has been identified; company chairman Lowry Kline will serve in the role on an interim basis.
    KC's View:

    Published on: December 2, 2005

    Good piece in the Boston Globe this week about a guy with a mission – to drink coffee in every one of the planet’s more than 5,000 Starbucks.

    Rafael Antonio Lozano tells the Globe that having spent more than $30,000 during the past year and visited almost 5,000 in the US and Canada, as well as 213 overseas, he has found the coffee – always caffeinated coffee, by the way - to be “amazingly consistent.”

    Not an easy task to accomplish, of course, if for no other reason than the goal is a moving target – Starbucks opens 11 new stores in the US each week, and plans to add a total of 1,000 units next year alone.
    KC's View:
    We sympathize. We were close to our goal of having visited every major league baseball stadium for a home game a few years ago, and then these teams started moving into new ballparks, throwing us completely off our game.

    We admire him, though. Man has to have goals.

    Published on: December 2, 2005

    On the subject of Marsh Supermarkets giving certain executives raises and/or bonuses in advance of announcing that it was considering a sale of the company, one MNB user wrote:

    I read your comments on the possible sale of Marsh Supermarkets and agree if Don Marsh was considering consumer and employee opinion, this was not the right time to pay bonuses and give raises to executives. Having worked for Marsh Supermarkets before, I've seen this type of consideration before when top executives were given bonuses even though deserving associates were not paid bonuses because the company had not met its' goals for the year. All that being said, the Marsh family and executives own the majority of stock in the company. It sounds like they are ready to "cash in their chips"! I'm not sure who is going to buy Marsh Supermarkets, but I hope they have sense to utilize the great associates that work there now and let them continue their mission of consumer satisfaction through original offerings and differentiation.

    Another MNB user wrote:

    From the report, it appears to me that the CFO received a bonus for just doing what he is paid to do anyway.

    Our reaction, too.

    MNB user David Livingston wrote:

    This is just life in the big city. Obviously Marsh has been an underperformer for many years and they realize that they have a very dim future competing in a market with three supercenter chains (Wal-Mart, Meijer, and Super Target). To compound all of this, they must compete against Kroger, Wal-Mart Neighborhood Market, and they fast growing upscale stores such as Whole Foods, Trader Joe's, and Fresh Markets. Even Supervalu has announced they will open their first organic price impact store in Indy.

    Marsh operates good stores but unfortunately not good enough. With no real hope of ever seeing the price of their stock rise, executives simply want to preserve their wealth when it comes time to cash out.

    About the only way to do this is to pass out raises, bonuses, and severance packages. This is not like the Titanic where the captain goes down with the ship. I'm sure these actions will not be popular with small stockholder and low level workers, but they are not the ones in power. That is just the risk one takes when they invest in a company or choose an employer.





    We had a story yesterday about how food-borne illnesses seem to be increasingly connected to fresh produce, which led MNB user Lisa Malmarowski to write:

    I was at a competitor's store, a conventional market, picking up a few things and looking around. In the produce department, in an attractive multi-deck, were packages of pre-cut fruit. I thought - Wow, that looks good and considered buying it to try it.

    And then thought, "Hmmm, that could be a problem for us - we do fresh cut organic fruit in our stores- besides being organic, how will consumers know the difference". Then I took a closer look. The fruit was pre-packed in California. We're in Wisconsin. I was, to put it bluntly, grossed out. I mean, who packed that 'fresh' fruit? Where was the fruit from? I know who packs ours and where it comes from.

    If people, both stores and consumers, are concerned about the safety of their food, they need to know where it's from and who has handled it and how they've handled it. Customers can look into our produce prep areas if they want and see how we do things. I certainly couldn't do that with the pre-cut produce at our competitor's store.

    I'm naive I guess, but I continue to be amazed that the average consumer doesn't demand to know where their food comes from. I'm glad the average shoppers in our stores do. So we will continue to provide this information and work with our regional suppliers whenever possible - to ensure higher standards of food safety, support our local farms and offer high quality products.


    MNB user Liz Schlegel chimed in:

    Seems like another argument for labeling country of origin on food -- as well as buying locally produced food! If the long travel distances are part of the problem (as cited in the WSJ article), well, there's a solution to that. Hey, if they can grow lettuce in Vermont all winter, they can grow it anywhere!




    We had a story yesterday about how the success of Donald Trump’s new line of suits has created awareness of his strength as a brand…which led one MNB user to write:

    Uh, I guess all of the brand conscious people from the 70’s that bought Johnny Carson suits will finally have a new brand of clothing to buy for a year or two. Maybe The Donald will also have Macy’s open up a Trump hair styling salon next to the men’s clothing department and they can offer $100 Trump Comb Overs with every suit purchase. If you want to mimic him you might as well go all the way.




    Finally, we had a piece yesterday about the new popularity of wine in small plastic bottles with screw tops…a trend that we’ve decided to stop fighting, even though we plan to only drink wine that comes in glass bottles that are corked.

    Which led MNB user Sriram Daita to write:

    Here we go again.

    Do you still drink beer from a wooden keg?

    Let me take a shot here of what this would have sounded in 1990

    KC: Dear, can you believe this story? Apparently in 10 years people are going to be reading news on computer and writing to each other on computer. And next thing they are going to say that computers will do our shopping, pay our bills and even help us make money.

    Mrs. Content Guy: It can’t be that bad.

    KC: I know that in 10 years I will still be reading a newspaper, paying my bills by check and damn me if computer is going to make me money. Mark my words all this computer mambo jambo is going to die.

    Mrs. Content Guy (as she sighs internally): – Yes dear. Calm down and let me open a favorite bottle of wine to relax you. Hey, where is the corkscrew! Why don’t you put back things where you found them after you used them?

    (Mrs. Content Guy finds the corkscrew.)

    Mrs. Content Guy: You know, KC, it will be great if they can make wine with a screw top that way I do not have to search for the corkscrew.

    (KC faints in shock about having to see wine bottle without cork.)



    We only have one comment about this little playlet.

    Mrs. Content Guy never sighs…internally.

    Trust us.
    KC's View:

    Published on: December 2, 2005

    A couple of weeks ago, we mentioned that we’d made shrimp and lobster risotto, and subsequently received a number of emails asking for the recipe.

    Here it is:

    Simmer two containers of chicken broth (not to a boil). Keep hot on stove.

    Peel and then chop two large onions into small pieces. (Try not to cut off your finger.)

    Pour yourself a glass of wine. This isn’t hard work, but it takes about a half-hour.

    Heat pan on medium on the stove. Put about 1/4 cup of olive oil into the pan. Let warm for about 30 seconds, then add the chopped onion.

    Add a pinch of saffron, a generous dose of Emeril’s Essence, and a couple of cloves of crushed garlic.

    Stir occasionally, letting the onion cook through. Once the onion is cooked and about to start browning, add about a cup and a half of Arborio rice to the pan, stirring quickly to make sure the rice is completely coated with the onion/olive oil mixture.

    Add a half stick of butter or margarine. Let melt, stirring constantly.

    Once the liquid has started to cook away, add a ladle of the chicken broth. Keep this up, stirring constantly, for about 20 minutes, never letting the risotto get too dried out. Occasionally, replace the broth with white wine. You have to keep stirring, making sure the rice doesn’t stick together.

    After 20 minutes, add two pounds of cooked/frozen shrimp (rinsing it first in warm water to make sure the ice is off it). Sprinkle on some more Essence. Keep stirring.

    Once the shrimp is coated, add a half-stick of butter/margarine and a 1/2-cup of shredded mozzarella. Keep stirring. Keep adding broth as needed to keep the rice coated. Five minutes in, add some fresh lobster meat. After about 10 minutes, add another 1/2 cup of mozzarella cheese.

    Risotto should be creamy, and the Arborio rice, when cooked correctly, should be ever so slightly firm.

    Serve with a green salad…a hunk of bread…and a nice Pinot Noir.



    Speaking of Pinot Noir…

    Here’s a good one I had the other night: a 1999 Domaine de Charmy Bourgogne Rouge from France…it has a little bit of a spicy finish, but is very good with almost any meal – especially the shrimp risotto.



    I don’t like it quite as much as “The Daily Show,” but “The Colbert Report” is sort of growing on me.



    Just 44 days until “24” returns.

    Be still my heart.



    If it is making a return engagement in a theater in your city and you haven’t seen it, you should make an effort to see “Cinderella Man,” which was a terrific movie about heavyweight boxer Jim Braddock and the personal and professional travails he faced during the Depression. If it isn’t in your city, rent or buy the DVD when it comes out next week. Wonderful performances, especially by Russell Crowe as Braddock and the always-terrific Paul Giamatti as his manager, Joe Gould. Neglected by audiences when it first came out, this, like last year’s “Million Dollar Baby,” is far more than a boxing movie – it is about courage and sacrifice and the importance of family.



    I have to admit it. I can’t wait to see the new “King Kong.”



    That’s it for this week. We're out of material.

    Have a good weekend.

    Sláinte!!
    KC's View: