retail news in context, analysis with attitude

MNB Archive Search

Please Note: Some MNB articles contain special formatting characters, and may cause your search to produce fewer results than expected.

    Published on: June 5, 2008

    Fascinating piece this morning in the New York Times reporting that “after waging an aggressive public relations campaign against Wal-Mart for three years, the company's full-time, union-backed critics, who once vowed never to let up, are lowering their pitch forks. Shrill condemnations and embarrassing leaked documents are being replaced by acknowledgements of progress - and, in the case of Wal-Mart Watch, free advice.”

    Exhibit one in this report is the existence of a nine-page report that has been circulating through Wal-Mart’s headquarters, “proposing sweeping changes to its employee health care plans,” that was “commissioned, paid for and given to Wal-Mart by its longtime foes, the Service Employees International Union, and a group the union finances called Wal-Mart Watch.”

    The Times reports: “The union-financed campaigns were launched in 2005. As the groups turned up the heat on the company, Wal-Mart was at first defensive, but eventually it responded in ways few of its critics expected. The company expanded its health care plans to cover more workers, though still not enough to satisfy the unions. And it made commitments to the environment, like becoming the biggest U.S. seller of more efficient light bulbs.

    “Indeed, Wal-Mart has gone so far on some initiatives, like the environmental ones, that it is drawing attacks from the right, particularly from a group called the National Legal and Policy Center, which has accused the company of giving in to political correctness. Now, the union-backed groups appear to have concluded it would be more constructive, sometimes, to engage Wal-Mart. That leaves them navigating a complex situation in which they have to decide, issue by issue, whether to shake hands with the company or to slap it.”

    And there has been some impact within Wal-Mart, as well. “The less antagonistic approach from the union-backed groups is evident inside Wal-Mart, which had hired dozens of new employees to combat the negative public relations onslaught,” the Times writes. “Over the past several months, the company has disbanded a campaign-style war room set up in 2005 to do battle with Wal-Mart Watch and WakeUpWalMart.com. The latter group is financed by the United Food and Commercial Workers Union.

    “And Wal-Mart has killed off an advocacy group, called Working Families for Wal-Mart, intended to rally support for the company (and serve as a counterbalance to the anti Wal-Mart groups).”

    KC's View:
    It sometimes seems extraordinary that even in 2008, it is a revelation to some folks that talking is always better than fighting, that constructive discussion almost always leads people and institutions to a better place where understanding – even amid ongoing suspicion – is at least possible.

    Give both sides credit here.

    They likely never will agree on everything. And maybe both labor and management will be stronger for providing a counter-balance to the other.

    And shame on those on either side of the aisle who would prefer open hostilities and lack of progress, who think that there is no room for mutual respect.

    Published on: June 5, 2008

    The Times of London reports that the United Food and Commercial Workers (UFCW) has launched an advertising campaign in the UK that condemned Tesco “for the way in which it treats staff in the US and said that there were stark differences with the rights and benefits enjoyed by workers in Britain. Union officials unveiling the ‘Two Faces of Tesco’ campaign in London pledged to name and shame the retailer until its directors came to the negotiating table.”

    According to the story, “The move represents a significant escalation in the union’s campaign for recognition at Fresh & Easy, the convenience store chain that Tesco started in America last November … The union said that the stance could hinder Fresh & Easy’s potential expansion to cities such as New York and Chicago, which are heavily unionised. Wal-Mart, which also refuses to recognise the UFCW, has hardly any presence in either city.”

    Tesco responded to the new campaign by saying that its Fresh & Easy employees have no desire to join the UFCW and that their pay and benefits are such that no union representation is needed.

    KC's View:
    So I guess that maybe it is going to take some time for Tesco and the unions to get to the same point that Wal-Mart has reached with its critics.

    Published on: June 5, 2008

    Ethisphere magazine has released its 2008 list of the world’s most ethical companies, which it describes as “the ones that go above and beyond legal minimums, bring about innovative new ideas to expand the public well being, work on reducing their carbon footprint rather than contributing to green washing and won’t be found next to the words ‘Billion Dollar Fine’ in newspaper headlines any time in the near future.”

    Among the food and retailing companies that made the cut:

    • Aveda Corp.
    • Dole Food
    • Gap
    • General Mills
    • Henkel AG,
    • IKEA
    • Kao Corp.
    • Kellogg Co.
    • Marks & Spencer
    • McDonald’s
    • PepsiCo
    • SC Johnson & Son
    • Starbucks
    • Stonyfield Farms
    • Target
    • Ten Thousand Villages
    • Trader Joe’s
    • Unilever
    • Whirlpool

    According to the magazine, “All of the 2008 World’s Most Ethical Companies are standouts in their industries. These companies up the ante for what it takes to be an ethical leader and force their competitors to follow suit or fall behind.

    “The World’s Most Ethical Companies use ethical leadership as a purposeful method to drive profits. Finally, each of these companies embodies the true spirit of Ethisphere’s credo: Good. Smart. Business. Profit.”

    KC's View:
    Y’think there actually are companies out there where they sit around in meetings talking about what it would take to operate as an ethical leader…and then say, “Nah.”

    Actually, I can think of a couple. In fact, I’ve worked for a couple.

    Published on: June 5, 2008

    CNN reports that Tyson is saying that a flock of its chickens at a northwest Arkansas plant has tested positive for what is called “a mild strain of avian influenza,” which the company says shows “no signs of illness and the situation poses no risk to human health.”

    The 15,000 chickens will be immediately destroyed as a precautionary measure.

    KC's View:
    I much prefer the way Arkansas Business puts it when it says that Tyson “has begun depopulating a flock of 15,000 breeder hens.”

    “Depopulating.”

    What a great word.

    Published on: June 5, 2008

    In upstate New York, the Daily Messenger points to Wegmans as an example of a company that thrives while remaining “committed to our corner of the upstate world.

    “With what seems like a grocery store on every corner around here, the company has been looking outside New York for new business growth — and, true to form, it has been quite successful in its expansion endeavors.

    “Already with stores in Pennsylvania, New Jersey and Virginia, a new Wegmans store is a strong possibility for a community outside Boston, the chain’s first foray into the New England market.

    “ Sure, it may seem like Wegmans’ attention is focused elsewhere, but the bottom line is, any new stores secure Wegmans jobs back home and, for the foreseeable future anyway, its considerable presence here.”

    KC's View:

    Published on: June 5, 2008

    The New York Times reports that new studies suggest that red wine – and more specifically, the compound resveratrol that is an ingredient in many red wines - “may be much more potent than was thought in extending human lifespan.”

    According to the Times, “Some scientists are already taking resveratrol in capsule form, but others believe it is far too early to take the drug, especially using wine as its source, until there is better data on its safety and effectiveness … Serious scientists have long derided the idea of life-extending elixirs, but the door has now been opened to drugs that exploit an ancient biological survival mechanism, that of switching the body’s resources from fertility to tissue maintenance. The improved tissue maintenance seems to extend life by cutting down on the degenerative diseases of aging.”

    KC's View:
    No bad news here.

    I thought red wine was just good for my heart, good for my mood, and, when poured in a tin cup chalice, made me think about Paris, made me want to jump on a plane…

    But now, to find out it might help me maintain my youthful demeanor…?

    Yippee!

    Published on: June 5, 2008

    • The Wall Street Journal this morning reports that Gregory B. Penner, “the 38-year-old son-in-law of Wal-Mart Chairman S. Robson Walton, himself a son of company founder Sam Walton,” is expected to join the company’s board of directors – a move that is seen as a kind of changing of the guard and generational shift.

    Walton is seen as grooming Penner for a leadership role at the company, according to the Journal: “In 2000, Mr. Penner helped to start Walmart.com, influencing the company's decision to locate its now-booming online unit in Brisbane, Calif., in the San Francisco Bay area, far from Wal-Mart's headquarters in Bentonville, Ark. Two years later, he moved to Japan, where he was involved in vetting the purchase of Seiyu Ltd., and became its chief financial officer. The Japanese unit, which posted a loss of $216 million last year, has bled red ink since Wal-Mart's initial investment.

    “More recently, Mr. Penner has managed Walton family investments through Madrone Capital Partners in Menlo Park, Calif. But he has remained a quiet presence at Wal-Mart, attending board meetings and offering to accompany executives on trips to Asia.”

    KC's View:

    Published on: June 5, 2008

    In Canada, the Toronto Globe and Mail reports, “KFC Canada and People for the Ethical Treatment of Animals have cut a deal that will see the Canadian chain improve its chicken slaughter conditions and introduce vegan menu options … The fake chicken, known as unchicken, has been around for years and is available in a handful of restaurants and stores in Canada. Most of the fake meats are soy-based and fair game for vegans. Some may contain eggs, but are meat-free.”

    The deal comes after five years during which PETA has targeted KFC Canada for what it claimed was cruel treatment of the chickens it was selling in its stores. As a result of the deal, PETA said it will suspend its Kentucky Fried Cruelty campaign in Canada, though the organization also said that it will continue pressing KFC in the United States to make similar concessions.

    KC's View:

    Published on: June 5, 2008

    • The Austin Business Journal reports that both HE Butt and Whole Foods have recalled “fresh Roma and large field-grown round tomatoes after the Texas Department of State Health Services warned of a salmonella outbreak linked to eating uncooked tomatoes … State health officials believe the consumption of raw tomatoes is the likely source of the bacterial infection.”

    • The Palm Beach Post reports that Publix has opened a new GreenWise organic and natural foods store in Boca Raton, which doubles the number of GreenWise stores operated by the company. According to the story, “The all-new store does feature many of the new elements introduced at the first GreenWise in Palm Beach Gardens, including green or environmentally friendly designs.”

    • Ahold-owned Stop & Shop has received the John A.S. McGlennon Environmental Award for Corporate Leadership from the Environmental Business Council (EBC) of New
    England, recognizing the company for “outstanding accomplishments in the promotion of a sustainable, clean environment.”

    • In the UK, The Grocer reports that William Morrison Supermarkets has instituted price cuts on more than 2,000 products in a wide variety of categories including groceries and HBC. The move comes as Morrison seems to be growing its market share at a time when market leader Tesco’s percentage of the nation’s grocery sales has been dipping a bit.

    • As expected and reported earlier this week, JM Smucker is acquiring the Folger Coffee brand from Procter & Gamble or $2.95 billion in stock.

    KC's View:

    Published on: June 5, 2008

    • The Wall Street Journal reports this morning that Carrefour plans to name Amaury de Sèze as chairman and José Luis Durán as chief executive, under a plan to simplify its governance structure. The moves, according to the story, appear to reflect “increased influence of billionaire Bernard Arnault and his partner Colony Capital on the France-based retailer,” both of which have built a significant stake in Carrefour.
    KC's View:

    Published on: June 5, 2008

    • Costco said that its May sales rose 12 percent to $5.77 billion, on same-store sales that were up nine percent. US same-store sales were up seven percent, while international stores were up 15 percent compared to the same period a year ago.

    KC's View:

    Published on: June 5, 2008

    Now available on iTunes…

    To hear Kevin Coupe’s weekly radio commentary, click on the “MNB Radio” icon on the left hand side of the home page, or just go to:

    http://www.morningnewsbeat.com/Radio/Radio_Listen_S.las



    Hi, I’m Kevin Coupe, and this is MorningNewsBeat Radio, brought to you by Webstop, experts in the art of retail website design.

    When I began MorningNewsBeat more than six years ago, one of my goals was to create a site that people could read while having a cup of coffee and that, hopefully, would have at least one or two stories each day that they’d want to tell someone about when they went to get a refill. That means, however, that I try to respect your time and keep MorningNewsBeat’s coverage to a reasonable length…not every story makes the cut, as much as I would like to write about them.

    This morning, however, I thought I’d bring up a couple of stories that I’ve read during the week that sort of intrigued me, but that didn’t make it into the daily column…

    For example, there was the Wall Street Journal interview with Campbell Soup CEO Douglas Conant, in which he conceded that his company had lost the innovation war in soup last year, despite the fact that it is a category that the company continues to dominate. “That can't happen again,” he said.

    My first reaction to this piece was that Douglas Conant must be a very secure and confident guy, because admitting that you’ve lost the innovation war isn’t usually a way to warm the hearts of investors and board members.

    But it ends up that this is a consistent approach on the part of Conant, who has some basic tenets about how to do business – including “confront the brutal facts and be clear-eyed about the situation,” and “give the organization time to do things right.” I suppose that if the company goes another year in which it loses the innovation war there may be investors looking for people’s heads on pikes. But I don't think that is likely to happen…especially because I’ve tasted the V-8 soups that the company is coming out with in August. In fact, we mentioned them as a hot new product on our first edition of FoodWireTV, and I know for a fact that I’ll be buying them by the case. They taste great and are a great idea.

    There also was a story in Advertising Age about purposeful marketing campaigns – in other words, campaigns that go beyond just trying to sell stuff, but have a broader contextual meaning.

    Examples include companies like Procter & Gamble and Unilever creating wellness campaigns that attempt to redefine the notion of what is beautiful or what is healthy. Or Kimberly-Clark rolling out a $2 million, three-year "Not on My Watch" program for a bus tour “to teach nurses and others to combat hospital-associated infections that kill an estimated 100,000 people annually in the US.” Or Johnson & Johnson funding the world’s largest database on children’s sleep issues.

    I have to say that in today’s competitive environment, pretty much everybody should be talking about the meaning that products and services have in people’s lives, or the ways in which these items can change perceptions and actions. I love the notion advanced by the Institute for the Future that we live in a “VUCA” world…one that is volatile, uncertain, complex and ambiguous…and I think that by creating marketing with meaning, or the purposeful campaign, companies have the ability to make the world less volatile and less uncertain, with both less complexity and more clarity.

    This could be a game changer for a lot of companies.

    Finally, there was a story that didn’t make MorningNewsBeat because I couldn’t figure out how to make it relevant…but I can't ignore it anymore. Let me quote to you excerpts from the column by Clyde Haberman in the New York Times

    “You see, there were these two New York guys acting like, well, New York guys. In some circles, they’re called alpha males. Sometimes, alpha males come hard-wired with omega emotional quotients.

    “That seemed to be the case with these guys, both Wall Street types. They went to the same spinning class at a gym on the Upper East Side. For those of you unfamiliar with the term, spinning involves a workout on a stationary bicycle. It has nothing to do with a Gandhi-like pursuit of producing one’s own clothing.

    “One of these men, Stuart Sugarman, was being obnoxious in a New York guy way. To pump himself up, he kept grunting loudly and shouting phrases like ‘Good burn!’ and ‘You go, girl!’ The fact that other people might not have appreciated his loud grunts and screams was a concept apparently beyond his grasp.

    “One of those other people, Christopher Carter, couldn’t take it anymore. He was a few feet away on his own bike. He asked the grunter to pipe down. To be more precise, he yelled the four-word New York version of “shut up.” The grunter told him no. To be more precise, witnesses reported that Mr. Sugarman said, “Make me,” and gave Mr. Carter a salute — neglecting, however, to use all his fingers.

    “Mr. Carter hopped off his bike. (We told you these were New York guys acting like New York guys.) He picked up the front end of Mr. Sugarman’s bike, drove the rear end into a wall and let go. Knocked off his perch, the grunter literally hit the wall. He landed in the hospital for two weeks.

    “For his burst of anger, Mr. Carter was charged by the Manhattan district attorney’s office with a misdemeanor count of assault. He went on trial last week.

    “Here’s the thing, though. Some disinterested people believe that Mr. Carter should have been decorated, not indicted. We know this because they wrote us to say so. They also told bloggers the same thing.”

    I love it. ‘Give the guy a medal!”

    First of all, this is really good writing. And it is a really good story. But while you might think it is an “only in New York” story, Haberman has other ideas…

    “Examples of this phenomenon abound,” he writes. “An outsize sense of entitlement — coupled with an indifference to others — helps explain the drivers who barrel through crosswalks with no regard for the pedestrians with the right of way.

    “It helps explain ballpark loudmouths who couldn’t care less if those around them may be offended by their drunken swearing. It helps explain people who push their way into crowded subway cars before riders already in the cars can exit. It helps explain those who answer cellphones during a movie, or who take infants to the theater and then don’t leave when the babies start crying. It helps explain dog walkers who block sidewalks with their long-stretched leashes.”

    The evidence would suggest that people are beginning to relate more and more to Howard Beale, the anchorman character in “Network” who wanted people to throw open their windows and shout, “I’m mad as hell and I’m not going to take it anymore.”

    What evidence am I talking about, other than the fact that some people think that Carter should be given a medal?

    Well, there’s the jury in his case…which voted to acquit him.

    I think that’s a good thing. But to be honest, I’m not sure.

    For MorningNewsBeat Radio, I’m Kevin Coupe.

    KC's View:

    Published on: June 5, 2008

    Excellent suggestion from an MNB user responding to yesterday’s story saying that South Korean president Lee Myung-bak has retreated from his pledge to open his nation’s borders to US meat imports; the change of mind occurred because of public concerns there that such a move would increase the risk of mad cow disease in South Korea.

    I see this as an opportunity for a company to test all animals in order to get this business. Could be a BIG win. I wonder if any company is smart enough to figure this out.

    You’d think so.

    And yet, there remain people and companies out there that continue to believe expanded and exhaustive testing is a bad idea.

    Go figure.




    Also got a number of emails responding to our story about how Safeway has teamed with Warner Bros. to use Looney Tunes characters to promote its new line of kids’ healthy foods.

    MNB user Dave Tuchler wrote:

    Absolutely the right initiative.

    Now what they really need to do is borrow the WABAC machine from Sherman and Mr. Peabody, put all these kids in there and send them back to the 1960s where they might actually watch Looney Tunes. This franchise will certainly resonate with parents but doesn't seem that they're a big deal to today's kids. Unless they can find a way for Bugs to text, IM or post a message on kids' Facebook walls.


    Don't think for a moment that they haven’t figured that out…

    Another MNB user wrote:

    If they are really serious, and this is not just a marketing ploy to get more kids and parents into the cereal aisle…why don’t they take all the unhealthy cereals off their shelves?

    MNB user Randy Aszman wrote:

    Perhaps I am out of touch with what cartoons are hip since my kids are grown and gone, but I found it very cool that Bugs and Co. still resonates with children today. I know that I loved Looney Tunes as a kid (okay – I still do) as well as Rocky and Bullwinkle and Fractured Fairy Tales.

    To this day when I get a bit lost, I still mutter “I knew I shoulda taken a left at Albuquerque …”





    Regarding our mention earlier this week about the passing of rock pioneer Bo Diddley, one MNB user wrote:

    The problem with getting old is not that your body is breaking down, which makes it harder to keep in shape etc…, nor the fact that you may be losing your hair, or your teeth are not looking like the pearly whites you once had…the issue with age goes much deeper into our mental well being....the loss of days gone by.

    I grew up in a much simpler time. We did not have to lock our doors, we had to be home when the street lamps came on, our parents did not seem to worry as much about us, as we worry about our children today and where they are at all times. There was an understanding of right and wrong, and parents did spank their children, fathers were feared, respect of our fellow neighbor prevailed and manners were demanded or else.

    The music was also simpler and fun. Catchy tunes and crazy lyrics, Hound Dog, Say Man, When a Man Loves a Woman, Hard Days Night, Wild Thing, Good Lookin, Pretty Woman, and many others. Songs that were there to help you through your teen age years and comment on the times at hand… memories that will be with you forever, and remind you of how lucky you were to have experienced them. No social comments or guilt…that is just the way it was, and I for one, wish more of it were back today, especially “manners and respect.”

    Bo Diddley was a major part of my early years, as was Elvis, Little Richard, Beatles, Stones, Eagles, and many others who made those days unforgettable. Days gone by….talent that will never be replaced.


    I agree with you on most of this. For the most part, my music collection would go into the RIP department – all the artists are either older than me, dead, or belong to groups that have broken up.

    I will, however, disagree with you on one thing. My kids don't fear me, and I think that’s a good thing. Not that I behave as if parenting is a popularity contest, which I’ve always thought is the worst mistake parents can make.

    But fear? Can't go there, and don’t want to.

    KC's View: