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    Published on: February 13, 2008

    PCC Natural Markets announced yesterday that it has notified vendors and manufacturers of products sold at its eight western Washington locations that full disclosure of product ingredients is a standard they are expected to incorporate into their operations. PCC suppliers also are being required to provide signed statements that products sold to PCC do not contain ingredients from cloned animals or their offspring.

    PCC CEO Tracy Wolpert, said, “The failure of our regulatory agencies to mandate full disclosure of food ingredients makes it incumbent on leaders in the natural foods industry to step forward and provide what our consumers want. We look forward to working with our trusted suppliers to ensure traceability in the highest quality foods.”

    According to the statement released by the company, “Disclosure of some food ingredients, such as specific oils or spices, and the source of colors or flavors are not required by law to be identified fully on food products. Also, food manufacturers can reformulate their products at any time without notice to purveyors of their products or the consumers who buy them … In January 2008 the U.S. Food and Drug Administration ruled that products from cloned animals and their offspring are safe for human consumption. PCC disagrees with this ruling because the FDA failed to address several controversial points about animal cloning. PCC is requiring all manufacturers to submit a signed agreement that products sold to PCC do not – and will not –contain ingredients from cloned animals or their offspring. A provision of the 2002 Farm Bill requiring mandatory country-of-origin labels on beef, pork, lamb, peanuts, and fresh and frozen produce has yet to be implemented. PCC voluntarily labels all these products with their country-of-origin.”

    KC's View:
    PCC is right. If government isn’t going to stand up for consumers’ right to know, then the retailer has to do it.

    This is how it should be, really. The retailer needs to be the advocate for the shopper, not the agent for the manufacturer.

    Besides, this move allows us to say that for PCC, COOL should be SOP ASAP.

    Published on: February 13, 2008

    The Associated Press reports that President Bush’s proposed 2009 budget “calls for the U.S. Department of Agriculture to collect fees of $259 from each of about 37,000 retailers to pay for compliance reviews for mandatory country-of-origin labeling for meat and other food products.”

    Which prompted John J. Motley, III, senior vice president of government and public affairs at the Food Marketing Institute (FMI), to issue the following statement:

    “The U.S. Department of Agriculture (USDA) proposal to charge food retailers ‘user fees’ to enforce the country of origin labeling law (COOL) is outrageous. It violates the government’s own definition of ‘user fees,’ which are supposed to provide the user a clear benefit. USDA is pursuing a backdoor method to pay for a government regulation, costing the industry $9.6 million in 2009.

    “The only good news is that this idea is opposed by just about everyone affected by COOL, including produce growers, meat producers and even the law’s strongest proponents: the National Farmers Union and R-CALF.

    “This abusive amendment does not merit consideration by Congress. FMI is working vigorously with Congress to ensure it is not attached to the Farm Bill, the government’s fiscal year 2009 budget or any other legislation.”

    KC's View:
    While COOL makes sense, in my humble opinion, it seems to me that somehow the government ought to figure out how to make less ominous for retailers. Charging retailers, who will either have to pass the costs onto consumers or just eat them, doesn’t make sense. Manufacturers and producers, which are, after all, the source of all products, are closest to the source and therefore should have the primary responsibility for these new labeling rules.

    Published on: February 13, 2008

    The Seattle Times reports that Starbucks plans to close all of its 7,100 owned and operated stores in the US for three hours on the evening of February 26 and use the time to retrain some 135,000 employees in barista essentials. The move is part of the company’s efforts to emphasize core values and rebuild what it sees as weakened brand equity; the company previously announced that it will slow its US growth plans while moving faster outside the US, and that it will stop selling warm breakfast sandwiches by the end of the year.

    “We will have all new standards for how we create the drinks,” spokeswoman Valerie O'Neil tells the paper. “They will be trained in creating the perfect shot, steaming the milk and all the pieces that come together in a drink … It's really about ensuring that the customer experience that we provide is the best that it can be.”

    The Times notes that “there are also some 4,000 U.S. stores licensed to do business with Starbucks in supermarkets, airports and elsewhere. Workers in those stores will be retrained at about the same time but not necessarily on the same day.”

    KC's View:
    Ashamed to admit it, but the first thing I did when I read this story was immediately check my calendar to see where I’d be on the evening of February 26. Not that I’d find myself in Starbucks at that hour of the night, but it’s good to know that it is there. (I’ll be home, where there is plenty of ground Verona in the larder. Whew!)

    Seriously, though, one has to give Starbucks credit for taking this revival effort seriously. Part of this is smart marketing – the sales dollars lost during those three hours will be more than made up for by the kind of positive publicity that the company will get through news coverage. After all, how many retailers would do this, all in the name of improving both the product and the customer experience?

    Published on: February 13, 2008

    Delhaize-owned Food Lion said yesterday that “of the 1,300 grocery stores recognized today by the U.S. Environmental Protection Agency (EPA) for achieving ENERGY STAR ratings in energy efficiency, Food Lion LLC owns 703. Not only is this more than half of the nation’s total, it is also more than half of the chain’s 1,300 stores.

    According to the statement, “Commercial buildings that earn the ENERGY STAR use an average of 35 percent less energy than typical buildings and also release 35 percent less carbon dioxide (CO2) into the atmosphere. Based on EPA calculations, each of Food Lion’s ENERGY STAR stores saves as much as 86,000 kWh per year – enough to power nine American homes for an entire year. The energy savings at each store also prevent 190,920 pounds of CO2 emissions per year, equal to removing the pollution of 19 cars or planting nearly 26 acres of trees.”

    ENERGY STAR was introduced by the EPA in 1992 as a voluntary, market-based partnership to reduce greenhouse gas emissions through energy efficiency.

    KC's View:

    Kudos to Food Lion, but I have to admit that all this information makes me want to ask the folks there a couple of questions.

    Are the executives at Food Lion successful in getting their kids to turn off the lights when they leave a room? And if so, could they make any suggestions?

    Because I’ve gotten to the point where I think my chief jobs when I am home, other than doing the grocery shopping and making dinner, is to turn off lights around the house and turn down the heat to reasonable levels.

    Then again, maybe I shouldn’t complain. Because if I didn’t perform these tasks, maybe nobody would want me around.

    Published on: February 13, 2008

    Published reports say that scientists at Purdue University have completed a study suggesting that artificial sweeteners may not be helpful for people trying to lose weight.

    The premise is that sweet foods actually stimulate hunger, and that artificial sweeteners may actually cause greater hunger because they generally are not followed by a large amount of calories. The study suggests that in the long run, this can cause people to actually eat more.

    "Animals may use sweet taste to predict the caloric contents of food. Eating sweet non-caloric substances may degrade this predictive relationship," the researchers wrote in Behavioral Neuroscience, adding, "With the growing use of non-caloric sweeteners in the current food environment, millions of people are being exposed to sweet tastes that are not associated with caloric or nutritive consequences.”

    Now, to be sure, the actually study was done on rats, not people. And the Calorie Control Council, a trade association representing companies that make low- and reduced-calorie foods and beverages, suggested that tests on rats may not be applicable to people.

    "This study oversimplifies the causes of obesity," the Council said in a statement. "The causes of obesity are multi-factorial. Although surveys have shown that there has been an increase in the use of 'sugar-free' foods over the years, portion sizes of foods have also increased, physical activity has decreased and overall calorie intake has increased.”

    KC's View:
    Coincidentally, I’ve made a couple of visits to a local nutritionist since the beginning of the year, concerned that as I’ve put on too much weight as I’ve gotten older. (Which I have.) And while she talked about moderation and portion control and increased exercise, one of the major points she made was to lay off the diet drinks. And I’ve met a bunch of people in recent weeks who have had the same experience, and have switched from diet drinks to water.

    This could be a trend to which diet drink manufacturers will have to pay attention, I suspect. It’ll be interesting to see how it develops.

    Published on: February 13, 2008

    Good piece in the New York Times about how “the British government has made a big commitment to promoting the benefits of weight loss, the centerpiece of which is a three-year advertising campaign announced last month with a budget of £75 million ($146 million). But disagreements over the scope of the campaign — particularly over whether it is proper to let companies that make high-calorie and high-fat foods participate — have been clouding the effort before a single commercial (or logo) is made.

    “Everyone agrees on the problem: Nearly two-thirds of adults and about one-third of children in Britain are overweight or obese, health officials say. And advertising executives say they agree that in order to be effective, the anti-obesity campaign needs to be broad-based and pervasive,” perhaps along the lines of the red ribbon that signifies the campaign against AIDS, or the yellow wristband that has been popularized as supporting cancer research.

    The Times writes: “The fat-fighting campaign is short on specifics and long on controversy. Like most public-sector advertising in Britain, the effort will be run by the Central Office of Information, a government agency that coordinates advertising assignments and the buying of media space and time. The office has yet to choose agencies for the account … (and) Whether the campaign will use a logo as its signature is still up in the air. Several years ago, amid rising concern about obesity and about a possible backlash over the marketing of unhealthy food, London-based advertising agencies presented ideas to the government for an anti-obesity logo, a sort of counterpart to the triangular symbol that is used internationally on recyclable materials.

    “Rather than referring directly to food or exercise, the three symbols that were proposed by different agencies aimed to convey a message of personal investment in a healthy lifestyle. The executives promoting the idea suggested that the logo could be applied to food packaging, Web sites or even soccer shirts in order to make the message resonate with children.

    “But the idea stalled, advertising executives say, because of disagreements over how the program should be run. The government, for instance, wanted to be able to keep junk food brands from using the logo, but the food industry wanted to leave that decision to marketers. The logo would have appeared alongside a separate set of nutritional labels that are being phased in on British food packaging.

    “The lack of consensus about the logo started to look like a microcosm of the fight between the government, health groups and marketers over who should bear responsibility for the obesity problem, and what the proposed solution should be.”

    KC's View:
    Leading to the inevitable question…

    How many bureaucrats does it take to screw up an anti-obesity program?

    You read stuff like this, and you wonder how anything gets done. Marketers have their own interests to look after, and they may not be in synch with the public interest. But government often isn’t the best at looking after them, either.


    And yet, it seems fair to suggest that as obesity continues to be a problem that affects the health of the general population, some sort of smart, cohesive approach to consumer education makes sense.

    Maybe it is the Hannaford Guiding Stars program. Or the “Overall Nutritional Quality Index” (ONQI) program. But it seems to me that the best way to approach it is for marketers to be focused on consumer interests, and to stay ahead of where the government would legislate the issue. And maybe, just maybe, avoid the UK mess described by the Times.

    Published on: February 13, 2008

    The Seattle Times reports that Haggen, which operates 32 stores in the Pacific Northwest, is buying the last remaining Larry’s Market, in Redmond, Washington.

    The plan is to continue operating the store under the Larry’s banner, according to the story, which says that “Haggen plans to remodel the store and will consider other improvements, including a possible drive-up pharmacy lane.” It will be the third banner used by Haggen, which uses both the Top Food & Drug and Haggen Food & Pharmacy names.

    The unit had been owned by Associated Grocers, which got the store after Larry’s went into Bankruptcy in 2006.

    KC's View:

    Published on: February 13, 2008

    PepsiCo reportedly is testing a new soft drink in the UK – Pepsi Raw, which is said to be made only from natural ingredients, containing no artificial flavors, sweeteners or preservatives. According to press reports, it actually has a slightly lower calorie count than regular Pepsi and is slightly less carbonated.

    Published reports say that Pepsi is testing the new drink in bars and clubs in a few select cities, but could roll it out more broadly later this year.

    KC's View:

    Published on: February 13, 2008

    • The Boston Globe reports that Dunkin’ Donuts “is targeting the afternoon and evening crowds with new flatbread sandwiches and personal pizzas heated in convection ovens rather than microwaves.

    “The chain hopes the moves … will improve food quality and bolster an expansion plan that's introducing Dunkin's pink and orange-themed restaurants far beyond the brand's Northeastern base.” According to the story, “The goal is to even out sales throughout the 5 a.m. to 11 p.m. day maintained by most of the 5,400-plus stores in the U.S. About two-thirds of sales come before noon, with most customers choosing snacks such as baked goods and breakfast sandwiches with coffee.”

    Crain’s Chicago Business reports that Kraft Foods will raise the price of its Maxwell House and Yuban coffees to offset higher costs of beans. Ground and roast coffee will increase 15 cents a pound and instant coffee will increase 3 cents per ounce.

    Procter & Gamble announced Monday it was implementing a similar price hike on its Folgers coffees. A P&G spokesman says the increase will be six percent.

    KC's View:

    Published on: February 13, 2008

    • Wal-Mart announced yesterday that its Japanese subsidiary lost the equivalent of about $196 million (US) last year, twice as much as it expected, on sales that were 1.1 percent lower than anticipated at $8.8 billion (US) and same-store sales that were off 1.2 percent from a year earlier.

    Wal-Mart, which currently owns about 96 percent of Seiyu, has invested about $2.2 billion in the company since 2002.

    • Stater Bros. reported Q1 sales of $943 million, up about 4.3 percent from first quarter last year. Net income was $10.8 million, up slightly from the previous year's first-quarter profit of $9.9 million.

    • Weis Markets said that its fourth quarter sales increased 4.4 percent to $603.0 million compared to the same period a year ago, on same-store sales that were up 4.9 percent. Q4 net income totaled $8.6 million compared to $14.0 million in 2006.

    • Unified Grocers reported that its first quarter sales were $1.05 billion, up 34.7 percent from the $781.4 million generated during the first quarter a year ago – with the majority of the increase emanating from its acquisition of Associated Grocers. Q1 net earnings were $6.17 million, up from $3.46 million a year ago.

    • Molson Coors reported fourth quarter net income of $173.2 million, compared with $99.2 million during the same period a year ago. Revenue rose five percent, to $1.6 billion, slightly higher than analyst expectations of $1.55 billion.
    KC's View:

    Published on: February 13, 2008

    • Steve Smith, Sweetbay Supermarkets’ vice president of merchandising, has been promoted to senior vice president of merchandising.
    KC's View:

    Published on: February 13, 2008

    Got the following email from MNB user Joe Walsh:

    It's apropos that you ended your thoughts on Safeway's animal welfare push with an Abe Lincoln quotation. It may be of some interest to look at another of his many musings: "I am in favor of animal rights as well as human rights. That is the way of the whole human being."

    It would be interesting to get Honest Abe's perspective on the modern day American Food Machine. I wonder if he would equate "cage-free" with "ethical eating." I doubt it.

    Still, I applaud Safeway's push, for instance, to double the amount of cage-free eggs they carry. However, many of their customers would be surprised at what constitutes "cage-free.". While it is obviously true that hens on commercial cage-free farms are not kept in cages, it is equally true that the overwhelming majority of them have their sensitive beaks cut off with a hot blade and are jammed together by the thousands in massive, fecal ridden sheds where they will live for years until their egg production drops. Toward the end of their short lives many (but not most) are starved and deprived of water in a practice called forced molting that increases their egg production before they are totally used up. After hens are no longer useful as egg producers (at less than half their normal life span), they're sent to slaughter. Most of these gals never go outside, breathe fresh air, feel the sun on their backs, dust bathe or do anything else that is natural. They suffer from the same lung lesions and ammonia burns as hens in cages, and they have breast blisters to add to their suffering. However, for cage-free layer hens that are not packed 5 or 6 into battery cages (the bottom of which is not much greater in size than a legal pad), cage-free means a much less painful existence.

    Incidentally, retail customers never hear of the 200 million male "layer hens" who at the hatchery are either tossed alive into plastic bags to suffocate slowly or immediately get ground alive for use as fertilizer, pet food or pot pies.

    Well, if there was anyone thinking about having eggs for breakfast after reading MNB, I suspect they may switch to a bagel after having read about “sensitive beaks cut off with a hot blade and are jammed together by the thousands in massive, fecal ridden sheds where they will live for years until their egg production drops.”

    I actually envy Abe Lincoln. He only had to figure out how to win the Civil War. He might be considerably more perplexed by how to be an ethical consumer in 2008.

    On the subject of Wal-Mart’s new small-store format and the coming battle with Tesco, one MNB user wrote:

    I am not so sure the new Wal-Mart format will be as successful as everyone thinks. I suspect you are correct that the ROI on the Neighborhood markets is not what they want when compared to Supercenters. I wonder if the Supercenters would be able to make money if it were not the mix that they have. The margins on edible side are extremely competitive and very low. Without the benefit of consumers buying softgoods, clothing, toys, etc at the same time they were buying food, Wal-Mart would not have the outstanding ROI they enjoy today. The smaller format will make it very hard to take advantage of the mix, because of the smaller size and will put tremendous pressure on the perishables side of the business where they have improved but clearly not mastered. Regardless, it will be an interesting venture based on their ability (and deep pockets) to try new things.

    MNB user Paul Schlossberg wrote:

    The battle between Tesco and Wal-Mart will be interesting. The odds are that they (both) would be planning to source their customers and volume from traditional supermarkets. These are quick shopping formats. For the big weekly shopping trip, the traditional supermarkets and super centers will most likely continue to prevail. But for fill-in shopping, it appears that this is being offered as the new solution. There are more fill-in shopping trips than there are weekly pantry loading trips.

    Don't forget that others (Safeway for one) are moving in this same direction.

    Saving time for shoppers is important. Those retailers who figure out how to do it will have a lead on those slow to evolve.

    Will the new small format stores cannibalize existing stores? Almost certainly. But think about not moving in this direction. The least risk is experimenting with it. If the risk of experimenting is avoided, the potential problem to be expected is that your business will be cannibalized by a competitor.

    Somebody is going to do this and get it right. Seems to me that you have a better chance of succeeding if you play the game, and no chance of succeeding if you sit on the sidelines.

    I noted yesterday that Wal-Mart’s name does not appear to be part of its new “Marketside” logo, which led MNB user Mike Griswold to write:

    This is all about brand. Wal-Mart’s “brand” is not associated with fresh food or easy to shop stores. They are attempting to build a new brand with this format. This was the same approach for Fresh & Easy. Tesco’s goal is to be the best national (local) retailer, not necessarily the best global retailer. We have seen this work quite well with Food Lion’s Bloom stores and despite pulling the plug, Supervalu’s Sunflower market.

    On a related subject, speculation that Tesco may have eyes on Chicago for its Fresh & Easy format, MNB user Mike Parker wrote:

    Tesco better be on a fast learning track considering their less than impressive results in existing markets. If they apply to Chicago what they are learning on the west coast they will increase exponentially their inability to digest the market segmentation in the US. Unfortunately, success in retail leads to failure when you don’t thoroughly understand the markets you are entering. The US is far more diverse than Europe and European companies just don’t get it and that is why most of them have failed.

    MNB continues to get lots of email about the list of retailers deciding to no longer sell tobacco.

    MNB user Steven Ritchey wrote:

    I have to wonder if part of the reason some retailers are ending sales of tobacco products isn’t partly because of the expense and red tape involved and if the profits made don’t justify the problems.

    Another MNB user wrote:

    Do you think that by just stopping tobacco sales these store are saving us?

    No. I think they are preserving their brand integrity. They may also be saving their souls, but that’s a matter for others to decide.

    Another MNB user wrote:

    What about the Oreo's, lard, coconut oil and many other over produced foods that are KILLING more people than Tobacco. When they really put healthy food in the store then you can say "looking to make real connections between health/wellness and food", of course that will never happen!!!

    I disagree. First of all, none of the things you mentioned – other than tobacco – are engineered to addict and kill you.

    Second, the industry is moving in that direction. It sometimes seems more like baby steps than giant leaps, but the movement is happening … and at some stores, it is happening faster than at others.

    Of course, better and more transparent labeling mandates might help…

    On the always interesting subject of food labeling – whether we are talking about country of origin, cloning, or GMOs – one MNB user wrote:

    I could not agree more that the products should be labeled. Consumers have any number of reasons to want information, and it is not up to government agencies to decide which information based on reductionist science that "proves" a product is safe.

    Frankly, it is the equivalent of patting us on the head and telling us to go home and let the grown-ups worry about the food supply. And look where that got us. Partially hydrogenated oils, a diet comprised of up to 60% refined grain, refined sugar and vegetable oils! Look at the recent concerns that sugar substitutes are contributing to the national weight gain. Do not forget the "qualified" health claims now allowed on food labels - that don't actually give any real information but allow a marketing push.

    Consumers want to make choices based on something other than lab reports. Some have religious and cultural concerns, viewing food as part of a larger ecological and cultural, even sacred, context. Where do clones and genetically engineered foods fit for them? Labeling is the least we can do.

    As food retailers we answer to our customers, not to the industrial food complex. If I can't tell my customer where a product came from and how it got the way it is, it is not a product I want to sell.

    And MNB user Dustin Stinett had some thoughts about cloned food:

    When I read your comments about the "condescending" attitude of the pro-cloning set, I couldn't help but wonder if you are confusing condescension with exasperation. After all, for years now the cloning industry has been answering the same questions over and over. And the follow-up questions are the same question, just asked differently.

    "Is it safe?"

    The answer is yes. And they give the reasons. Then they are asked,

    "Okay, but can the source be trusted?"

    "Yes," and they explain why (again).

    "Okay, but is it reliable?"

    And so on and on. It's like having the kids ask you "Are we're there yet?" on a road trip.

    How many times does the same question need to be answered and explained?

    Yes, it's safe and there is no difference between a cloned cow and a "real" cow.

    I’ll buy that. But I still want it labeled. And it fascinates me that so many people in the cloning business would prefer not to have labels and not to have to mount a patient and persuasive education campaign.

    By the way, at some point when your kids kept asking “are we there yet,” you probably turned around that threatened to punish them if they didn’t knock it off.

    But in this case, the cloning folks don't get to punish anyone. The consumer has that power – by deciding not to buy any product that they think suspect.

    I wouldn’t mess with consumers on this one.

    On the subject of GMOs, one MNB user wrote:

    I found it interesting that one reader who wrote in last week said the world would be "a far hungrier place without the benefit of GMO crops." The reason that was interesting to me is because the two most prevalent GM crops are corn and soybeans. These crops are usually grown here in the US where they are turned into oils, animal feed, high fructose syrup to sweeten our sodas, and (increasingly) ethanol.

    Most GM crops are engineered not to increase yield when grown under any conditions. They are engineered to work specifically with certain pesticides and herbicides. These crops are grown for the purpose of being able to survive large-scale chemical applications that kill all other living things in the area but allow the corn or soybeans to stand untouched. And these crops are heavily subsidized by the American government. The more corn you can produce, the bigger your subsidy check, the more you end up paying back to Pioneer or Monsanto.

    The worst part is that this system of growing GM crops to feed livestock (with meat being a luxury largely unavailable to the world's hungriest populations) or to be placed into a myriad of processed foods and heavily subsidizing it is among the biggest culprits in world hunger. A whole host of subsidized American crops drive down world prices and make it impossible for farmers in developed countries to sell their crops and have money left over to feed their families.

    While it's certainly each person's right to decide whether or not they want to eat genetically modified foods, to hail them as saviors of the world's hungry is highly disingenuous. Do enough research and it becomes readily apparent that the majority of GM crops are not being engineered with the world's hungry and poor in mind.

    Thanks for being willing to provide a space for all the different views available...all this debate, if nothing else, encourages educated decision making when choosing what we feed ourselves and our families.

    It’s nice to be appreciated....

    MNB user Amy Buttery had some thoughts about another story:

    In your piece on banks ignoring consumer payment preferences, you comment:

    “Analyst Litan has the right idea – retailers can actually turn this situation to their advantage by marketing against the credit card companies. They may have to take these forms of payment, but that doesn’t mean they have to help their shoppers get ripped off.”

    Using contactless cards or signature-based debit cards doesn’t rip off the shoppers—it rips off the retailers, through higher processing rates for those transactions (and for contactless, the expense of upgrading terminals). Sure, the retailers may be able to pass off their increased payment-processing expenses through higher prices, but in this economy it’s difficult, and the retailer is caught in the squeeze. I agree that if retailers can steer customers to forms of payment that cost them less (like PIN-based debit) they should, but they have to be careful not to violate agreements with credit card associations (Visa/MC), which stipulate that you have to take all forms of their cards, even when some cards cost the retailer much more to process, nor can you charge more for using certain forms of payment (“cash or credit, same low price” as some still say).

    The real catch-22 for retailers accepting various types of plastic is not so much technologies like contactless or mobile, but reward and corporate cards, which look and act in the store exactly like other credit cards but which cost the retailer *much* more in processing fees. Actually, sig-based debits are similar—my bank now rewards me for using my debit card as a sig-based card, which I would have found odd if I didn’t know how processing fees are calculated.

    I find this completely unfair—the bank wants to increase use of its cards by paying customers rewards, but fund the program by making the retailer pay more on these transactions. Higher transaction processing rates should reflect higher risk (about which the retailer may have some control), not pay for programs that benefit the banks. Retailers must accept these reward and corporate cards with a smile or risk ticking off the customer, who only wants to earn those miles or other rewards.

    You also write: “It is extraordinary how much money has been spent by the credit card companies in promoting schemes that do very little to help consumers and that are only there to improve the companies’ bottom line.” Just a note: the card companies make money on these higher-rate transactions, but the banks make even more. Incidentally, the card-processing middlemen that retailers commonly associate with these processing fees typically have brutal competition and are just passing through the rates enforced on them by Visa/MC. (Yep, I work for a card-processor....) The card companies and the banks together negotiate these rates, so of course they work out deals that are sweet to them, but it shouldn’t be on the backs of the merchants (which in a good economy eventually gets passed on to the consumers in higher prices).

    As for contactless cards not catching on—I think it was reasonable for banks to assume they might catch on, and one has to let such technologies have a while to see if they can overcome the unfamiliarity factor. It’s possible contactless will never catch on probably because consumers don’t understand the technology and perceive them to be less secure—but on the face of things, it was a reasonable notion to explore. (I love my contactless card at Meijer and always use its “fast tap” feature when it’s available, so I’m somewhat biased.) I don’t really see any advantage to mobile-phone based payment systems, but I haven’t thought about that one as much—seems like a younger generation concept to me.

    Got the following email from MNB user Thomas Murphy:

    Glen Terbeek’s commentary on “Can large centralized organizations (i.e., national retailers) and innovation coexist?” was very good. However, just to take a slightly broader view, I don’t think you have to innovate to survive or even to be successful.

    You must be able to hear or see innovation happening and then leverage your company’s size and influence to play “me too”. Who is a great example of this in the grocery industry? Kroger, they have been doing it for years. While I was with them from 1993 to 2000 we spent inordinate amounts of time in the IT organization watching, listening, and learning. We then partnered with a business champion and moved forward on everything from Computer Assisted Ordering, to real-time warehouse management, to customer loyalty programs. The same happened with my business counterparts. While it wouldn’t be fair to say that Kroger never had an original idea, it would be fair to say that the “me too” solutions had lower risk and more consistent results.

    Finally, responding to the MNB obituary and appreciation of Roy Scheider the other day, one MNB user wrote:

    The last movie I can recall seeing Mr. Scheider in is "RKO 281" in which he played RKO studio runner George Schaefer. While not a blockbuster, it's a fine little film with a pretty good cast (including Liev Schreiber, James Cromwell, and a great performance by John Malkovich).

    So I couldn't help but wonder what you meant by saying he was a "flame out" in "lousy" films of late. I had to run to to see what you were talking about. I realized that I hadn't even heard of the majority of them until I got down to “RKO 281” (1999). Thank goodness my memories of him are positive, for he holds an important place in my life. "All That Jazz" was the movie my wife and I watched on our first date. I can still remember what she was wearing that night almost 30 years ago. I will never forget that film, Scheider's incredible performance, and Cindy's outfit.

    That’s the thing about wonderful movies and wonderful performances…you often can use them to mark great life moments. I’ve been blessed with an enormous number of opportunities to see such movies and plays over the years, and often in unusual circumstances.

    MNB user David Livingston also had some thoughts about the Scheider appreciation:

    For someone who specializes in retail, you have really a skill for finding the extra ordinary talents of lesser known actors.

    Thanks. I’ve written enough film criticism and unproduced screenplays in my life that I appreciate it when you all put up with my digressions.

    But here’s what’s really funny. Roy Scheider was anything but a lesser-known actor. At the height of his career, he was a major star. But as I said, Hollywood stars often flame out…but they leave in their wake some wonderful work that will last for ages.
    KC's View:

    Published on: February 13, 2008

    IRI has added a new breakout series to its 2008 Reinventing CPG & Retail Summit – an in-depth look at how shopper demand for convenience is impacting the entire Retail and CPG landscape; how the new convenient shopping experience is transforming store formats, assortments, merchandising strategies, product innovation, and collaboration; and how industry leaders are preparing their organizations for convenience retailing 2010.

    Included in this series is a “Future of Convenience Retailing” roundtable, featuring panelists that include Kevin Elliott, senior vice president of merchandising at 7-Eleven, and Joe Patti, vice president of category management for Anheuser-Busch. The moderator: Kevin Coupe, “Content Guy” of

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