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    Published on: July 31, 2006

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    KC's View:

    Published on: July 31, 2006

    The annual Food Marketing Institute (FMI) Human Resources/Training & Development Conference this year will help attendees discover real world solutions to HR challenges, learn how to take employee productivity to new heights, and stay ahead of the curve by understanding industry trends.

    And to get things started with a bang, it’ll also feature opening remarks by MNB “Content Guy” Kevin Coupe, who will use his trademark insights and irreverence to put HR challenges into a broader context.

    The place: The Ritz Carlton Hotel in Montreal, Quebec, Canada.

    The dates: September 17-19, 2006.

    How to learn more: Go to…

    http://www.fmi.org/events/confmain.cfm?meetings_id=308

    KC's View:

    Published on: July 31, 2006

    Wal-Mart, finding sauerbraten too difficult to digest, may be developing a hankering for kangaroo.

    The Sydney Morning Herald reports that Wal-Mart, having sold its German stores to Metro after almost a decade of trying to make that effort work, reportedly is “looking at trying its luck in Australia and is sizing up our two biggest supermarket operators, Coles Myer and Woolworths.”

    Wal-Mart executives reportedly have visited Australia looking for acquisition targets.

    None of the companies mentioned in the reports have confirmed any interest or knowledge of Wal-Mart’s plans, though Coles CEO John Fletcher says that everything he knows about Wal-Mart’s interest in Australia he’s learned from the media.

    And, in other Wal-Mart news…

    • The Associated Press reports that Wal-Mart is advertising for someone to run “health care communications” and can the way that the company communicates its approach to benefits for its 1.3 million US employees.

    This role would be in addition to the new communications director, Leslie Dach, who was hired by the company last week.

    • Wal-Mart announced that it will donate $5 million to the National Urban League to fund job training and other work-related programs at the black empowerment organization.

    Forbes reports that a trade union local has been formed at one of its 60 stores in China, which has a federal law requiring companies to allow employees to join the All-China Federation of Trade Unions (ACFTU), which has some 150 million members and is the only legal union in the country.

    While Wal-Mart has said that despite its long antipathy to trade unions it wanted to be in compliance with Chinese law, it had been singled out by some Chinese officials for being slow to allow unionization.
    KC's View:
    We tend to believe the Australian reports, even though an actual acquisition by Wal-Mart could be months away.

    Remember what Woody Allen said about relationships in “Annie Hall”?

    “A relationship, I think, is like a shark. You know? It has to constantly move forward or it dies. And I think what we got on our hands is a dead shark.”

    Well, a company like Wal-Mart is the same way…and it has no intention of turning into a dead shark. Failure in Germany only means that it has to turn its attention elsewhere.

    A memo to our friends in Australia and New Zealand: You need to start competing with Wal-Mart today. You need to start defining and creating your differential advantages right now…no matter when the Bentonville Behemoth actually makes its move into your part of the world.

    Published on: July 31, 2006

    Good piece in the New York Times over the weekend noting that while the news often details the ways in which people are less healthy than ever, this in fact is not the case. There have, in fact, been what the Times calls “striking shifts in human existence — a change from small, relatively weak and sickly people to humans who are so big and robust that their ancestors seem almost unrecognizable.”

    According to the Times, “The difference does not involve changes in genes, as far as is known, but changes in the human form. It shows up in several ways, from those that are well known and almost taken for granted, like greater heights and longer lives, to ones that are emerging only from comparisons of health records.”

    Studies say that throughout most of the industrialized world, there is less heart disease, lung disease and arthritis than there used to be just a few generations ago. People not only live longer but better. People even are smarter than ever: “The average I.Q. has been increasing for decades, and at least one study found that a person’s chances of having dementia in old age appeared to have fallen in recent years.”

    The Times reports that improved health care seems to be only part of the reason, that issues like nutrition and exercise from early childhood can have a dramatic impact as people get older. “Each event can touch off others. Less cardiovascular disease, for example, can mean less dementia in old age. The reason is that cardiovascular disease can precipitate mini-strokes, which can cause dementia. Cardiovascular disease is also a suspected risk factor for Alzheimer’s disease.”
    KC's View:
    Remarkable reporting, especially since so many of us (and we are as guilty of this as anyone) tend to focus on the problems with health care and the myriad ways in which people seem to be letting themselves fall apart.

    Imagine if we all really ate right and exercised more? We’d live to be 150.

    In fact, we’re gonna start.

    Tomorrow.

    Published on: July 31, 2006

    The Food Marketing Institute (FMI), looking to generate ideas for the education-only conference that will replace the annual exhibition on an alternating year basis starting in 2008, has posted an online survey that reportedly is available to retailers, suppliers and other past attendees.

    An introductory note from FMI senior vice president Michael Sansolo says that “FMI is hoping to build even better educational offerings for the future and we welcome your thoughts on all the different ways that we can use conferences or alternative forums to best fulfill your needs.”

    The survey is both quantitative and qualitative, asking respondents to indicate the number of conferences that they attend on an annual basis, what level employees attend conferences, as well as to indicate which conferences they feel are best and why, and which conferences have best met their needs.

    The survey also suggests that FMI is considering a number of different options as it prepares for 2008. One of the questions reads:

    Thinking about format options, which do you prefer?

    • Conference format addressing a select number of topics and a number of seminars within those topics. For example, the consumer track, supply chain, HR, etc.

    • Conference format built around experience and management level. For example, category management 101 and category management 401.

    • Combination of both.


    If you’re interested in taking the survey, go to:

    > http://www.zoomerang.com/survey.zgi?p=WEB225GFL56BTU

    KC's View:
    By offering respondents the ability to expound on their priorities through open-ended questions, FMI clearly is setting itself up to receive a wide range of opinions…but the real challenge will be to make the fundamental changes required by a new world of retailing – and communications - realities.

    We think that the 2008 conference has to be a kind of “FMI University,” reinventing the traditional trade show in unique and unexpected ways. When FMI says “alternative forums,” we hope they’re serious…because it may well be that just bringing thousands of people to a single place for two or three days may be a completely outmoded model.

    Published on: July 31, 2006

    Michigan-based Meijer announced that it is unveiling a chain-wide initiative in which thousands of unadvertised items with be discounted every day, and effort that almost certainly is designed to blunt the impact of Wal-Mart in its market areas.

    According to the statement released by Meijer, “The ‘Price Drop’ program will be a visible fixture in all 175 Meijer stores by July 31. Each store will be adorned with the full visual impact of the program, from hundreds of blue ‘Price Drop’ banners, shelf tags and floor graphics, to outdoor billboards, buttons and cart signs, all indicating where shoppers can find those unadvertised items that have been reduced in price. These components are all part of the ‘Look For The Blue’ campaign, which will introduce the new program to Meijer customers.

    The move will dramatically increase the number of price reductions across all areas of the store, and doing so on a longer-term basis than a sale item. On average, approximately 5,000 items are expected to be part of the ‘Price Drop’ program on any given day, and new items will be added every week. The program will include goods from all categories within the store, including grocery, home electronics, health and beauty, apparel, pets, toys and sporting goods.”
    KC's View:
    We understand the importance of emphasizing price in any battle with Wal-Mart, but we also hope that Meijer will promote the things that make it different from the Bentonville Behemoth, not just the price battleground on which they both are fighting.

    Published on: July 31, 2006

    Interesting profile in Business Week of Mary Minnick, who runs marketing, strategy and innovation for the Coca-Cola Co. "I tend to be quite discontented in general," BW reports she once told investors. "It will never be fast enough or soon enough or good enough."

    According to the article, Minnick is blunt, acerbic, stern though occasionally charming, and really smart – and not particularly concerned if she offends employees as she tries to cut through “the sclerotic complacency that has marked Coke for the past decade.”

    BW writes: “To Minnick, growth means more than simply boosting sales of Coca-Cola Classic. And innovation involves more than repackaging existing beverages in slightly different flavors. Minnick is exploring new products as far afield as beauty and health care. If she accomplishes even half of what's on her drawing board, she'll usher in the greatest flowering of creativity in the company's history. And should her plan succeed, she could end up CEO, if not at Coke then almost certainly elsewhere.”

    And: “With the solid backing of CEO E. Neville Isdell, to whom she reports, Minnick is pushing to transform Coke from a soda-centric organization that was long content to offer ‘me-too’ products in emerging categories to one on the cutting edge of consumer trends. At a private, mid-May meeting of Coke's top 200 global marketers in Istanbul, Minnick implored her troops to stop thinking in terms of existing drink categories and to start thinking broadly about why people consume beverages in the first place. The goal: to come to market with products that satisfy those needs before the competition…Minnick loves to talk about what she considers the 10 primal ‘need states’ that consumers have, including ‘hunger and digestion,’ ‘mental renewal,’ and ‘health and beauty.’ Creating drinks that meet each of those need states may mean inventing entire new categories. Imagine drinks, for example, that are fortified with vitamins or nutrients and provide women the same benefits as a facial scrub or cold cream. In the future, Minnick says, the winners will be the beverage companies that develop breakthrough products that, more often than not, cross over traditional beverage categories.”

    Ironically – or perhaps not – there also is a story in the Atlanta Journal-Constitution that quotes John Brock, CEO of Coca-Cola Enterprises, the company’s largest bottler, as saying that “if Coke doesn't innovate fast enough, the bottler will acquire drinks in fast-growing categories other ways.” Including from other companies.
    KC's View:
    While we have to be honest about the fact that we don’t admire a bulldozer management style – “The Devil Drinks Diet Coke” anyone? – it would seem that Minnick certainly is doing what someone in charge of innovation needs to do.

    As we read this piece, though, we kept thinking that all companies – not just the ones that have fallen on hard times – require “breakthrough products” that help them remain compelling and relevant to their customers. If cultures of innovation were more common, then perhaps fewer companies would find themselves in desperate need of such fixes, and a bulldozer management style wouldn’t be necessary.

    Published on: July 31, 2006

    The Washington Post reports that while the food industry is pushing for federal legislation that would forbid individual states from requiring specific label warnings, a former US Food and Drug Administration (FDA) official said that the agency “is plagued by backlogs and staffing shortages” and is simply too strapped to handle such legislation.

    According to the Post, “The food industry wants Congress to prevent states from adding food warnings that go beyond federal law, affecting laws about milk safety in Massachusetts, Michigan and Nebraska and warnings about allergy-causing sulfites in Connecticut, Michigan and Virginia… The food industry's primary target is California's voter-passed Proposition 65, which requires warnings about cancer-causing chemicals or reproductive toxins in food, such as mercury in canned tuna or lead in Mexican candy.”

    KC's View:

    Published on: July 31, 2006

    The BBC reports that the heat wave that has been victimizing Europe is having an impact on the food supply.

    “High temperatures mean vegetables are maturing faster than farmers can pick and package them, an agricultural body has warned,” the BBC writes. “The extreme heat has struck down crops across Europe, with economies in the east suffering in particular.

    “In Poland and Hungary some crops are expected to be 40 percent below normal yields, the Association of European Fruit and Vegetable Processing Industries warned. It said the very hot weather was creating a short picking season that might deplete frozen vegetable supplies.”
    KC's View:

    Published on: July 31, 2006

    • The US House of Representatives voted over the weekend to raise the minimum wage to $7.25 over the next three years; it has been $5.15 since 1997. The same bill includes an elimination of the estate tax for estates that smaller than $5 million, or $10 million for married couples; the estate tax would be tiered for larger estates.

    However, the bill now goes to the Senate for consideration, where experts say it could have a rougher time.

    • Last Thursday, MNB reported that Supervalu intended to convert some of the Southern California stores that it acquired from Albertsons back to the Lucky banner that was abandoned by the old Albertsons regime. This decision puts a new spin on the court battle currently taking place over the Lucky name, which Grocery Outlet started to use in northern California – saying that Albertsons had lost its rights to the tradename because it essentially abandoned it for more than three years.

    It now is reported that Supervalu also plans to open two new Lucky stores in Las Vegas next month, and will use the banner in other locations where appropriate.

    Assuming, of course, that the continuing legal battle works out in Supervalu’s favor. For the moment, the US District Court in San Francisco has sided with Albertsons argument that it never intended to abandon the Lucky brand, Grocery Outlet has covered up the “Lucky” banner on the Rocklin store, though it has said that it intends to file an appeal.

    • The Miller Brewing Co. has promised to spend as much as $80 million to bring its Milwaukee brewery up to date, and the state of Wisconsin has pledged $1.25 million in tax credits to aid in the effort. The goal of the state initiative is to keep more than six hundred manufacturing positions from leaving the state.

    Reuters reports that an increase in wheat prices this year is going to cause an increase in some cereal prices, with Kellogg Co. saying it will raise the price of some of its cereals by two percent. Nabisco says it has no plans to raise cereal prices at the moment, and General Mills isn’t commenting.

    • The Wall Street Journal reports on the new popularity of mozzarella, which “is pushing its way up the food chain.” Mozzarella bars are coming into vogue, and chefs who use it treat mozzarella with reverence.

    But here’s something that may be a surprise: Connoisseurs say mozzarella should be eaten at room temperature within 48 hours after it's made
    KC's View:

    Published on: July 31, 2006

    • The Chicago Tribune reports on the resurgence in online grocery shopping options, noting that Amazon.com and Meijer have each announced forays into the venue, albeit using different strategies.

    Amazon is selling non-perishables, both mainstream and exotic, and is selling many of them in bulk so as to maximize savings and help customers reduce their shopping trips. In many ways, the Tribune notes, it is like going to Costco…except without actually having to go to Costco.

    As for Meijer, it is selling mostly exotic items that would not be found even in the enormous stores that it operates. This is, in a sense, the “long tail” theory of grocery shopping (as written about by Chris Anderson in his book of the same name), in which the Internet can be employed to expand the range of choices available to shoppers.
    KC's View:
    The thing that really caught our eye about the Tribune story was its notation that Peapod actually has been in business for 17 years…which seems like an eternity in Internet terms. That’s a remarkable record coming in a retailing venue that has been fraught with peril and littered with the carcasses of companies that have died trying to figure out how to make it work.

    Published on: July 31, 2006

    One MNB user had a reaction to Wal-Mart decision to pull out of Germany:

    Outside of Canada and Mexico, the success of Wal-Mart's international operations seems to have been rather tepid at best.

    Their ability to adapt to international markets has been rather limited.

    Their ability to grab increasing market share also seems to be rather limited - certainly completely unlike their experience in the U.S.. It seems that their international competitors are scarcely terrified by them - unlike their U.S. competitors have been (although the U.S. situation seems to be changing a bit now).

    Wal-Mart also appears to be facing challenges in the U.S. completely beyond the scope of what they have faced in the past. They are clearly still in a fantastic position in the U.S., but they seem to be constantly looking over their shoulder for the very first time. It still beats me as to how they think they can spruce up their stores and the Wal-Mart shopping experience while continuing with their low cost part time labour policies.

    I was recently in a store up here in Canada (Calgary) which looked like a bomb had hit it. The condition of the store was a total disaster. I chalked it up to the fact that they are simply unable to attract a suitable employee pool. Virtually all of the employees in the store appeared to be students. I know that Calgary is a boom market at present and that good employees are hard to find, but no store under any circumstances should accept such deplorable conditions in a store.

    Just as a side note, I read a note in one of the papers recently that at least one financial analyst stated that they are concerned that the "shelf-life" of a typical Wal-Mart Supercenter may be far less than was originally anticipated due to perceived changes in retail shopping trends. This may or may not turn out to be correct. All I can say, however, is that the last thing we need is a couple of thousand abandoned Wal-Mart Supercenters littering the landscape.


    Another MNB user chimed in:

    I’m somewhat surprised that they decided to sell and get out, even though it seemed like the writing was on the wall. It doesn’t seem to be their style to admit a mistake and jump ship. I was so sure Wal-Mart wouldn’t bail, that I said to a friend, “Hell will freeze over, before Wal-Mart leaves.”

    I walked into work today, and heard only this phrase, “Hell has frozen over.”


    MNB user Tom Drummond wrote:

    Now all we need for Wal-Mart to do is pull out of Chicago with the absurd new City Council ruling on city wages. That would for once an all teach a Power Hungry Council that they can't tell companies (large and small) how to run their business ...!




    We had a story on Friday about reports that the US government is considering new regulations that would require alcoholic beverage labels to list possible allergens that might be in them including such unexpected items as fish, shellfish, milk, eggs, tree nuts, peanuts and soybeans. It ends up that fish protein, for instance, is often used to clarify wine or beer before bottling…and there are concerns that people could have allergic reactions to it.

    We were curious about one thing: When was the last time someone with a seafood allergy got an allergic reaction after drinking a beer or glass of wine?

    One MNB user responded:

    When was the last time you ask? It was the last time I drank a glass of red wine. Allergic reactions have caused me to stop drinking red wines. I’m still okay with white wines though.

    And another MNB user wrote:

    I am one of the unlucky people who have had a mysterious “reaction” to some alcoholic beverages. Two different beers have induced reactions and I am 99.99% positive it was not the food I was eating (all things I have eaten regularly my entire life). I also recently discovered that I am sensitive to sulfites, a common ingredient in wines (especially white). This was an eye-opening discovery for me because I have had some varied reactions (anything from a headache to my throat starting to close) to wines over the past few years. Some wines cause reactions and others don’t, so it is a gamble I take every time I try something new.

    Being a person who also has other food allergies (most of which are not common food allergies) I would love to be able to read the label of an alcoholic beverage and know exactly what is in it, just as I do with every item I buy in the grocery store. Ingredient lists have saved me many uncomfortable (and potentially life-threatening) allergic reactions. I am fully in favor of ingredient and allergen labeling on alcoholic beverages, and, for me, it can’t come too soon. It would be nice to enjoy a glass of wine or a cold beer without having my Epi-pen and some Benedryl nearby!


    MNB user Tom Piper wrote:

    I love red wine, but I’m definitely allergic to something in it, the tannins or whatever? Massive histamine release results that makes me very warm, but not in the happy sense.

    Also, beer is safe, all except for Heineken, which must have some ingredient in it that I’m extremely allergic too. Go figure.


    And still another MNB user wrote:

    I think you are way off base bashing putting food allergens on booze labels. Since I was diagnosed as having celiac earlier this year, I am very cautious to read every food label and talk to chefs whenever I eat out. I am still surprised about some of the things that contain wheat, barley, rye and oats that I wasn't aware of. Soy sauce is a big one, beer another. I haven't read enough on the various grain alcohols to know if I can drink them without suffering the unpleasant GI symptoms I lived with for many years. Please don't complain about labeling this until you have lived with someone with a significant food allergy or have one yourself. Luckily my food allergy doesn't cause a life threatening reaction, just several days of discomfort, but to be constantly worried about whether or not the next bite or sip of something would cause me to need my epi-pen just because you don't want to know what you eating is selfish.

    We plead ignorance. Which is no longer the case.


    But another MNB user weighed in:

    I am fatally allergic and never had a reaction…

    And another MNB user wrote:

    I'd like to see the labeling not because I'm allergic but because I'm vegetarian. That's gross. I may have to start brewing my own.

    And still another MNB user wrote:

    That's why I drink beer to Forget all the Stupid Programs and Requirements the government has put in place to protect me. Leave me alone let me be happy and make my own decisions based on personal taste and satisfaction.

    We sort of felt that way until we got so many emails from people with severe food allergies, people for whom the simplicity of an allergen label on a beer or wine bottle can have life-saving implications.

    It is hard for us to be flip in the face of such concerns. We were wrong to be so cavalier in our reaction, and we appreciate the education we got from the MNB community.

    As always, we learn more from you than you learn from us.

    KC's View: