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    Published on: May 9, 2008

    The extent to which consumers can talk to each other about their experiences – good and bad – is made clear in a WallStreetJournal.com piece looking at a site called Twisney.com, which gives people the ability to file real-time stories and pictures about their experiences at Disney theme parks.

    Now, for the most part these reports are positive – designed to share with family and friends (even those you've never met) what is going on in the parks that particular day. It even allows people in the park to read the stories on their PDAs or cell phones, and get information about what lines are longest or shortest.

    The Journal writes that for the moment the site is fairly unsophisticated, but it points to reality that is looming like an oncoming train: "For Disney and other companies that see such services evolve, there’s a potentially valuable opportunity to encourage passionate customers and even participate directly in the electronic conversation. But there are headaches looming as well–such as when the in-the-know park customers converge in one place after reading that 'No line at Space Mountain' message."

    And while the story focuses on Disney, there is no question that similar sites could be devoted to retail chains or even just the supermarket down the street. The message could be "no line in the deli department." Or, it could be, "don't buy the grapes, they're soft and sour."

    KC's View:
    The additional – and frankly, quite bigger – headache is that shoppers/consumers can post messages that will be critical of how a business conducts itself. It doesn’t matter whether a retailer likes it or not – the technology exists, it is a growing presence, and companies will have to deal with it. In fact, they ought to find ways to embrace it…because to do otherwise is both pointless and potentially damaging to its relationship with shoppers.

    Published on: May 9, 2008

    The Chicago Tribune reports that Wal-Mart's "hard-fought battle to turn Chicago into a beachhead for urban expansion across the country has come to a quiet end, at least for the foreseeable future, as big-city politics held sway over low prices.

    As the Tribune writes, "The retailer, which has a non-union workforce, ran into opposition from unions that have been trying to stop the Bentonville, Ark.-based company's expansion into northern cities. Both Wal-Mart and the unions say they help everyday working families. Wal-Mart points to its affordable merchandise, willingness to blaze a trail into the food deserts of inner cities, and the hundreds of workers each store employs." And the unions say that Wal-Mart pays too little and provides too few benefits, which victimizes working class people."

    In the end, the unions had more power in Chicago than Wal-Mart, and "now the world's largest retailer is turning its attention to a backup plan of opening stores just outside city limits, banking that thousands of low-to-middle-income city dwellers will travel to collar suburbs to shop at the discount store."

    KC's View:
    Next time a Chicago city official or union member decides to complain about a lack of food stores in the city's neighborhoods, I have a suggestion for them.

    Shut up.

    I'm not defending Wal-Mart here. But I am suggesting that it seems at last possible that Wal-Mart may have been willing to go into neighborhoods underserved by the food business…and that perhaps politics became more important than people's welfare.

    Not that this would be anything new.

    Published on: May 9, 2008

    The Contra Costa Times reports that the Dublin, California, city council has voted to ban the opening of retailing businesses larger than 170,000 square feet that devote more than 10 percent of their sales floor space to nontaxable grocery products.

    According to the officials who supported the ban on big box stores, the logic behind the vote was that a big box store would have a negative impact on traffic in he community and would hurt existing local and small businesses.

    However, the argument against the ban – albeit the losing argument – said that 1) the government shouldn't be banning businesses that generate tax revenue at a time when the economic is in a downward spiral, and 2) the ban was unnecessary because no company has inquired about building a bog box store within the city limits.

    KC's View:
    I've always felt that communities have the right to impose such limitations. (I live in a town that ought to ban banks, since the main street has so many banks that it is beginning to look like Switzerland, and yet the town fathers have said they would prefer not to have businesses like dry cleaners on the main thoroughfare.)

    That said, the arguments against the ban seem pretty compelling. Though suggesting that governments ought not to pass unnecessary legislation is sort of like saying that there ought to be a law banning the sun from coming up in the west.

    Published on: May 9, 2008

    The New York Times this morning reports that there has been some letup in the rising price of food…but that shoppers shouldn't take false solace in the momentary change of momentum.

    "After months of startling increases, the prices of rice, wheat, soybeans and several other foods have come down recently, a development that could ease some of the panic in global food markets," the Times writes. "Prices remain volatile and remarkably high by historical standards, and few agricultural experts expect the days of inexpensive food to return soon. There is no sign of a drop steep enough to make food affordable again for the hundreds of millions of people in poor countries who are struggling to maintain adequate diets … Experts say that shoppers may not see much benefit from the recent price dips. Many retailers and wholesalers around the world had not yet passed the full extent of this spring’s price increases along to consumers."

    KC's View:

    Published on: May 9, 2008

    Advertising Age reports that a story in The New Yorker contains a claim by a photo airbrush artist that he doctored pictures used in Unilever's "real beauty" campaign for Dove Soap, in which women are portrayed warts and all in their underwear. The concept behind the ads is that women are beautiful even if they are not supermodels, but the artist, Pascal Dangin, says that "it was great to do, a challenge, to keep everyone's skin and faces showing the mileage but not looking unattractive."

    This morning, Unilever issued a statement denying the charge, saying that the photos were only color corrected and that there was no digital enhancing of the images. And the airbrush artist is now saying that his statement was taken out of context by The New Yorker.

    If true, the story would at the very least undermine a broad and highly visible marketing effort aimed at redefining the notion of beauty.

    KC's View:
    I love The New Yorker, used to do some work for the magazine, and know that its vaunted fact-checking department is second to none. But I really hope they're wrong on this one, because I love that campaign and have even shown some of the videos supporting it to my daughter. It is that rare campaign – smart, perceptive, reflecting a cultural truth and supporting the brand message.

    Published on: May 9, 2008

    Sometimes it makes sense to change up a core business strategy.

    According to a story in USA Today, ice cream retailer Baskin Robbins has announced that it will begin selling soft-serve ice cream for the first time in its six decade history. The product will be in all of the companies 2,400+ US stores within the coming year.

    The reason? Soft-serve ice cream represents 70 percent of all ice cream sales, a segment in which sales have been either stagnant or down in recent years. And, it allows Baskin Robbins to compete with the likes of Dairy Queen, Carvel and McDonald's, all of which sell soft-serve.

    The risk? Some analysts tell USA Today that it is a lousy brand strategy because it undermines Baskin-Robbins' longtime message – that hand scooped ice cream is superior.

    KC's View:
    Don't eat a lot of ice cream anymore, but I have to admit that I don't completely understand the criticism of the decision. How is deciding to sell soft-serve ice cream a riskier move than, say, selling frozen yogurt? (Which Baskin Robbins has done without sinking the ship, best I can tell.)

    I do think that Baskin Robbins has to bring something different to the party…like new flavors that will allow it to differentiate itself from the competition. If the company does that, I don't see the risk.

    Published on: May 9, 2008

    The Seattle Post-Intelligencer reports that when ousted Starbucks CEO Jim Donald signed his $1.25 million severance agreement with the company, he agreed not to say anything bad about the company to "the oppress or any individual or entity," and the company, in turn, agreed not to say anything bad about him.

    Donald left the company in early January as a result of board and investor dissatisfaction with Starbucks' share price, as well as concerns about the company's growth trajectory at a time when a softening economy was impacting same-store sales. He was replaced by company chairman Howard Schultz, who returned to the CEO job in a company that he grew from a single Seattle location.

    More interestingly is the way that severance agreement defined how Starbucks sees its competition. Donald had to agree not to work for either Dunkin' Donuts or McDonald's, because they are viewed as direct competitors. However, he is allowed to work for fast food chains that include Wendy's, Arby's and Burger King, as well as for supermarket chains.

    KC's View:
    I've had a chance to talk with several Starbucks executives since Jim Donald's departure from the company, and there is a common thread to what they have to say about him.

    "I'd follow Jim into hell if he wanted me to," one executive told me.

    The board may have other agendas. But the people who worked with Jim Donald seem to have only good things to say about him.

    Published on: May 9, 2008

    The Dallas Morning News reports that Minyard Food Stores, as well as its Carnival and Sack 'n Save banners, "is giving away prenatal prescription vitamins to expectant mothers as part of its new community-based 'Start Life Healthy' initiative. The Coppell-based supermarket chain said its free offer is for 12 months, including three months after delivery … Prescriptions will be filled one month at a time and can be transferred from another pharmacy. No insurance is required."

    Estimates are that the program will save customers between $20 to $50 a month.

    KC's View:

    Published on: May 9, 2008

    • A Connecticut technology company called Ikan Systems announced that it is working with D'Agostino's Supermarkets to roll out a new system that will allow shoppers to scan food products at home, create a shopping list, transmit that list to the retailer, and then have the products delivered. The system is said not just to streamline the ordering process, but also, according to the Ikan website, allowed consumers to manage their at-home food inventory in such a way that it "saved time and money, reduced spoilage in household inventory, saved gas in unnecessary trips to the store and … recycle trash in the correct and responsible way."
    KC's View:

    Published on: May 9, 2008

    • Wal-Mart-owned Sam's Club announced that between May 18 and May 23, it will give away free annual memberships or $40 gift cards to existing club members. This is in addition to the already-announced decision to cash economic stimulus checks for free.

    The promotion is tied to the purchase of certain merchandise.

    Bloomberg reports that Wal-Mart plans to open 27 stores in Canada by the end of the year, most of them supercenters. The openings represent an investment of hundreds of millions of dollars, according to Wal-Mart, that will result in the creation of 6,000 jobs in Canada.

    The openings will give Wal-Mart more than 320 stores north of the border.

    • Wal-Mart announced that it is launching a new website designed to help customers "hungry for ideas to stretch their dollars during tough times." It will feature financial author Ellie Kay, who will be "speaking about practical ways in which women, families and children can better understand how to save and spend their money. Her advice will serve as a resource for budget-conscious shoppers looking for tips and tools as they face a summer of rising costs for gas, food and other necessities."

    KC's View:

    Published on: May 9, 2008

    At least one retailer out there has a sense of humor about itself.

    The Los Angeles Times reports that in the current movie release "Baby Mama," Greg Kinnear plays the owner of an independent smoothie shop in New York City who refers to Jamba Juice as "corporate juice pimps."

    And what the did the real-life corporate juice imps think of the reference?

    "We thought it was funny," Paul Coletta, Jamba Juice's vice president of marketing, tells the Times. "We're a brand that was built on fun. We're part of the pop culture, and being part of the pop culture conversation is what helps us stay relevant in consumers' minds."

    KC's View:
    That's refreshing. Coletta also said that he's glad the filmmakers chose to make fun of Jamba Juice rather than another brand.

    Good for them.

    Because the one thing more important than being able to tell a joke is being able to laugh at yourself when someone makes fun of you. It is a lot harder, but infinitely more important.

    Published on: May 9, 2008

    • In West Virginia, the Wheeling News-Register reports that a dozen Kroger stores remain open despite the fact that unionized employees have voted down a contract offer from the retailer. The employees have authorized a strike, but negotiations continue and no strike date has been set.

    • Winn-Dixie announced that it will begin featuring a weekly special promotion keyed to helping consumers "stretch their grocery dollars" as they begin receiving the government-issued economic stimulus checks.

    • There are published reports that Unilever is looking to sell its $465 million Bertolli Italian olive oil and balsamic vinegar refining business – though with a twist. The company wants to sell the commodity side of the business but then license back the brand because it is a high-margin segment in which it has been successful.
    KC's View:

    Published on: May 9, 2008

    • Delhaize Group said that its first quarter profits in its US operations were $241.2 million on revenues of $4.6 billion, compared to U.S. operating profit of $240.6 million on revenues of $4.38 billion for the same quarter last year.

    Total Q1 sales for the global company were the equivalent of $6.9 billion (US), down from $7.2 billion (US) a year earlier; first quarter operating profit was the equivalent of $316.9 million (US), down from $353.7 million (US).

    • Wal-Mart announced that its April sales were $29.18 billion, up from $26.57 billion during the same month a year ago, on same-store sales that were up 3.2 percent.

    • Royal Ahold said yesterday that its total Q1 sales dropped 1.3 percent to the equivalent of $11.6 billion, which it blamed on the slide of the US dollar. The company said that first quarter same-store sales at US units open at least a year rose 1.2 percent at Stop & Shop and fell 1.5 percent at the Giant- Landover division.

    • Costco Wholesale Corp. said that its April 2008 sales were $5.54 billion, up 12 percent from $4.94 billion in the same month period last year. Same-store sales were up eight percent.

    Year-to-date sales for Costco were $46.88 billion, an increase of 12 percent from $41.90 billion during the same period a year ago, on same-store sales that were up eight percent.

    • PriceSmart, the membership club company operating 25 stores in central America and the Caribbean, announced that its April sales increased 28 percent to $88.9 million from $69.5 million during the same month a year ago. Same-store sales were up 22.1 percent.

    Year-to-date, sales were up 25.3 percent to $716.5 million from $571.9 million a year ago, with same-store sales up 20.3 percent.

    • Family Dollar Stores said that its April sales increased 7.2 percent to $516.0 million, on same-store sales that were up 4.3 percent.

    • Longs Drug Stores announced that its April sales were up 0.4 percent to $366 million, on same-store sales that were down 1.5 percent.

    • Dollar Tree announced that its first quarter sales rose 9 percent to $1.05 billion, on same-store sales that were up 2.1 percent.
    KC's View:

    Published on: May 9, 2008

    …will return.
    KC's View:

    Published on: May 9, 2008

    Say what you want about Washington DC, where so much seems to go wrong. They appear to have gotten one thing right … by copying a program already quite popular in places like Paris and Barcelona.

    According to the Washington Post, the program is called Smart Bike DC, and it makes bicycle rentals available to anyone who has signed up for a $40 annual membership that gives them "access to a network of bikes stored at computerized racks around the city. To unlock the bike, users simply scan their access cards. The bikes can be used for up to three hours at a time and can be returned at any SmartBike station. In the beginning at least, there won't be any hourly charges.

    "The District of Columbia program is starting small, with just 10 stations and 120 bikes. In contrast, Paris started its service last summer with more than 10,600 bikes at 750 stations. But D.C. officials are eager to expand it quickly if the response is good. Proponents say the program easily could be expanded to more than 1,000 bikes at more than 100 stations within a year."

    When I was in Barcelona a couple of weeks ago, these bikes and bike racks were ubiquitous – and it was one of the most charming things about the city. And anything that gets people out of their cars is a good thing – not just because it reduces pollution, but it can't help but have a positive impact on the city's obesity levels.

    This is a case in which being more European is a positive thing. One of a number of cases in which Americans could learn much from out brethren across the ocean.




    Had a chance yesterday to spend a rainy afternoon at PNC Park in Pittsburgh, where the Pirates defeated the San Francisco Giants 5-4. No special occasion – after leaving FMI in Las Vegas, I flew to Columbus, Ohio, to pick up my son Brian from Ohio Wesleyan university, where he's just completed his freshman year. It long has been our goal to visit every major league baseball stadium together, so we're grabbing every possible moment…Pittsburgh was located between Ohio and home, there was a game, and so we got tickets. (If that meant I wasn't going to have time to read all my email and do "Your Views," well, that seemed like the right priority.)

    Anyway, going to PNC Park makes us feel even more anticipatory about next year's opening of Citi Field, the new home of the New York Mets. Like Safeco Field in Seattle, which we visited last summer, and Camden Yards in Baltimore, which we did shortly after it opened, these new stadiums are wonderful places to watch ballgames….expansive yet intimate, with far better sightlines and food than their predecessors.

    But forget the baseball. This goal of visiting stadiums is a terrific way to spend time with a young man who increasingly amazes me. This is my Starbucks barista, and I've always been proud of him…but this year, as he has embraced the college experience, he has blown us away. He went off to school a student of uncertain skills and dedication, but he's gotten very good grades and (this really gets us) has declared a double major – sports marketing and history. We spent yesterday talking not just about baseball, but internships and where he would like to study abroad, and just had a great time. No surprise, because he is a great kid. No, check that. He's a man. And I'm proud of him.




    Robert B. Parker has a delightful new young adult novel out entitled "The Boxer and The Spy," which is a great way to introduce to the man who created the Spenser and jess Stone mystery series of novels. The book has all the elements that Parker likes to explore in his books – a young man learning to be autonomous and self-sufficient in the boxing ring, a deepening and respectful romantic relationship that shows the potential for lasting forever, and a general disrespect for institutions and affluent people that put their own needs first. (Wait a minute. Except for the "young man" part, this begins to sound like my life.)

    "The Boxer and The Spy" is a great gift for the teenager in your life, and if you're like me, you may even read it before handing it over. Good stuff, and an entirely acceptable way to pass the time before Parker's next adult novel, a western entitled "Resolution" that is a sequel to "Appaloosa," comes out in a few weeks. (There also is to be a new Spenser novel, "Rough Weather," out in October…and one of these days there will be a new CBS movie, "Thin Ice," about his Jesse Stone character, starring Tom Selleck.)




    I had a couple of wonderful Italian wines over the past week while in Las Vegas – the Ruffino 2004 Riserva Ducale Chianti Classico (which went great with shrimp and penne fra diavolo that I had during a wonderful dinner at Rao's with Marv Imus), and a 2005 La Mozza I Perazzi Morellino di Scansano (enjoyed with Mrs. Content Guy and our good friends Jim & Joan while having a delightful pizza lunch at Mario Batali's Enoteca San Marco in The Venetian).

    In both cases, I was eating like an Italian. Another case in which there is much to learn from the other side of the Atlantic.




    This seems like a good moment to take note of the extraordinary emails that I received during the past week in response to my "Bank Of Good Habits" piece about having gotten into shape, losing 34 pounds by eating smarter and exercising more, taking boxing lessons and just deciding to change my life.

    I was overwhelmed, not just by the sheer volume of email, but the way in which so many of you shared your own stories – the frustrations and successes of getting older and trying to do the right thing, even when it is difficult.

    I feel your pain. It's always tough and never gets easier.

    But we're all in this together, and that does, in some ways, make it easier.

    Thanks, also, to all of you who congratulated me on my 25th wedding anniversary, and who went out of your way to commiserate with Mrs. Content Guy when you saw her at FMI in Las Vegas.

    You were right on both counts.




    That's it for this week. See you Monday.

    Sláinte!!

    KC's View: