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: September 4, 2008

    As reported earlier this week, the US Centers for Disease Control and Prevention (CDC) is saying that the recent salmonella outbreak, which caused more than 1,400 people to get sick, appears to be over … even as new reports emerge about an E. coli outbreak connected to an Oklahoma restaurant that has sickened more than 200 people and killed at least one person. The exact cause of this latter outbreak has not been determined, though it is fair to assume at some point that it will be, and that health officials will say that it, too, is over.

    However, the definition of “over” may not be what most people assume it is.

    The Washington Post reports that the CDC and other medical experts are finding that a number of chronic illnesses could have their roots in episodes of food poisoning, some of which took place years ago.

    According to the story, “Campylobacter, a bacterium associated with raw chicken, is now recognized as a leading cause of the sudden acute paralysis known as Guillain-Barré syndrome. Certain strains of salmonella, the bacterium involved in the recent outbreak in Mexican raw jalapeño and serrano peppers, can cause arthritis. And E. coli O157:H7, a strain of an otherwise harmless bacterium that lives in animal intestines, can release toxins that cause hemolytic uremic syndrome, or HUS, a kidney disorder that in 25 to 50 percent of cases leads to kidney failure, high blood pressure and other problems as much as 10 years later.”

    The Post notes that there are 76 million cases of food-borne illness in the US each year, resulting in between 5,000 and 9,000 fatalities – though the vast majority “experience it only as an unpleasant bout of diarrhea or abdominal pain.” But there are emerging opinions that some of these pathogens could have long-term impact on afflicted consumers, though for several reasons listed by the Post the issue is hard to study:

    “First, it is tough to prove a link between some of these illnesses and later chronic conditions such as arthritis. Second, despite annual outbreaks across the nation, the subject hasn't attracted much public attention or funding … Also, federal health-care privacy laws make it difficult for researchers to approach anyone who is not in their direct care.

    “To get around the last of these problems, STOP (an acronym that stands for an organization called Safe Tables Our Priority) is setting up a national registry of victims of food-borne disease who would be willing to participate in longitudinal studies. The registry could help researchers determine, for instance, how frequently food-borne infection leads to chronic health problems and what role factors such as genetics play in who develops them.”

    KC's View:
    Beyond the obvious medical issues, what this story points out is the fact that food safety issues cannot be minimized as mostly just the cause of a few stomachaches. There seem to be much broader and more long-term implications, both for consumers and for the credibility of the industry charged with feeding a nation. Trust becomes a much more fragile component of the shopper-retailer relationship, and the industry has to be vigorous to do everything possible to forestall further erosion.

    Published on: September 4, 2008

    Supervalu announced yesterday that it is launching a new line of 150 products, branded under the name “Culinary Circle,” that it says will allow shoppers “to enjoy restaurant quality food right at home easily and affordably, and is available nationwide at the company’s family of grocery stores, including Acme, Albertsons, bigg’s, Cub Foods, Farm Fresh, Hornbacher’s, Jewel-Osco, Lucky, Shaw’s/Star Market, Shop ‘n Save and Shoppers Food & Pharmacy.”

    According to the announcement, “The Culinary Circle brand will initially feature more than 150 items in the deli, bakery, frozen and center store aisles. Offerings range from on-the-go meals, elegant hors d’oeuvres and gourmet spreads to high-end desserts and artisan breads. Culinary Circle products will be priced approximately 20 to 25 percent below casual restaurant food and about 10 to 15 percent lower than other premium national brands … Inspired by the cuisine at some of today’s most popular restaurants, Culinary Circle products offer the latest in flavor trends and are made with unique, fresh, high-quality ingredients.”

    KC's View:
    One of the things I like most about this idea is that it simultaneously deals with two different consumer issues – the need to save a buck during a time of economic hardship, and the aspirational impulses that date back to when consumers had more disposable income and could indulge themselves.

    A lot of companies are talking about focusing on the former issue, but they shouldn't forget the latter…because this, as it happens, is where a lot of retailers can continue to differentiate themselves from the competition.

    Smart move by Supervalu. I just hope that the Culinary Circle products taste good…because that’s really were the rubber meets the road.

    Published on: September 4, 2008

    The Boston Globe reports that “with skyrocketing fuel costs and food price inflation at 6 percent, many consumers are rethinking how and where they shop for food … Some consumers are willing to make longer trips to discount supermarkets or pick-your-own farms - even if it means using more gas - because of the savings on food.

    According to the story, “Consumers young and old are taking to the fields this summer, picking their own produce for less money and visiting local farmers markets and stands as a way to avoid soaring grocery prices and address concerns about recent food scares.

    “Across the country, many farmers are seeing an uptick in business; here in Massachusetts some are reporting a more than 25 percent increase in sales, though there are no official industry surveys. Local farmers are finally able to compete on cost, and even offer lower prices in some cases, than area supermarkets confronting huge increases in shipping costs to haul produce from California and beyond.”
    KC's View:

    Published on: September 4, 2008

    Not that long ago, there was a report from the Simmons Kids National Marketing Survey saying that more than half of kids 6-8 years old encourage their parents to buy “green” products and express concern about “green” issues, and that 75 percent of people in this age group believe in buying recycled products.

    Now, according to a new study by ICOM Information & Communications, a targeted marketing group, consumers over 55 years old are the most prolific users of green products in the United States. According to the results of the survey, “Both male and female groups 55 years and over reported above average usage of environmentally friendly home goods. Leading the way was the 55-59 year-old female demographic, who was more than twice as likely as the average consumer to use green products. Males 65 69 years old were second, more than 1.7 times as likely to use than the average American.”

    The survey said that 61.9 percent of respondents said that they do use some type of environmentally friendly product, and that 33 percent of the group said they did so because it “makes me feel good about myself.”

    Half on non-adopters said the reason they did not purchase or use green products is because of the high price of such items, with 17 percent of people expressing skepticism that such products are good for the environment.

    KC's View:
    The only thing I find disheartening about this study is the idea that ICOM seems to believe that people 55 and older are in some sort of elderly demographic. I’m not there yet, but I’m close enough that it is sort of irritating.

    Published on: September 4, 2008

    The Charlotte Observer reports that Campbell Soup “is adding asterisks and something like footnotes to a line of reformulated Select Harvest soups aimed at making the growing number of careful label-readers among grocery shoppers more comfortable.”

    The goal of the reformulated labels is to demystify certain ingredients and provide interested consumers with better and more useful information – not just when it comes to things like chicken, but also ingredients like “maltodextrin,” which few people are likely to understand. The new labels, for example, note that maltodextrin is a carbohydrate made from potato or corn starch.

    KC's View:
    More information is almost always better information. Campbell may be trying to fit all this stuff on the label now, but you have to figure in a few years they will be able to convert it to some sort of electronic format that will be accessible via cell phones or PDAs.

    Published on: September 4, 2008

    The St. Petersburg Times reports that Delhaize-owned Sweetbay Supermarkets has signed a multi-year partnership deal with Major League Baseball’s Tampa Bay Rays, which will result in in-stadium signage and sponsorship of contests, as well as ads on the team’s television and radio broadcasts. Terms of the deal were not disclosed.
    KC's View:
    Not sure if this is good timing or bad. A year ago, this sponsorship probably would have been a lot less expensive…but it wouldn’t have been worth nearly as much. Tampa, after all, used to be a barely mediocre franchise…but this year, just weeks before the end of the regular season, the Rays are in first place in the American League East,, ahead of both the Boston Red Sox (three games back) and the New York Yankees (10 games back).

    It will take some effort for the Rays to hold off the Sox, but I’ll tell you this – the Yankees are done, done. Done. Stick a fork in ‘em. They’re done.

    Published on: September 4, 2008

    • Delhaize Group has published its first corporate responsibility report, entitled “A Healthy Approach To Live,” which endeavors to position the company’s approach to “the health and wellbeing of its customers, associates and the communities.”

    Three areas are targeted by the report: food safety and health, associate development, and energy conservation.

    • The Environmental Leader reports that at the recent Beijing meetings of the Coca-Cola Retail Research Council, Tesco CEO Sir Terry Leahy said that it is incumbent on the food industry to “go green,” because every dollar spent working on climate change issues now will eventually save children between five and 20 dollars. The report says that Leahy told the conference that “businesses should overcome barriers of price, and incentivize customers to buy greener products (since) consumers are directly and indirectly responsible for 60 percent of carbon emissions.”

    Leahy also said that an emphasis on “green” should not and will not affect growth and profitability, since reducing emissions and conserving energy can also cut costs in the long run.

    • The Chicago Sun Times reports that Safeway-owned Dominick’s “is planning to lease space to other retailers in 15 of its larger Chicago-area stores to try to boost sales,” with likely companies to include exercise gyms or fashion clothing retailers.

    • Anheuser-Busch, on the verge of being acquired by Belgian brewer InBev, announced yesterday that it is creating a non-alcoholic subsidiary specializing in energy drinks and high-end waters such as 180 Energy, BORBA Skin Balance Water, Icelandic Glacial and Monster. The subsidiary will be called 9th Street Beverages.

    KC's View:

    Published on: September 4, 2008

    • Unilever announced that it has named Paul Polman, currently the head of Nestle’s Americas business, to be its new CEO, succeeding the retiring Patrick Cescau, who will leave the company at the end of the year.
    KC's View:

    Published on: September 4, 2008

    • Walgreen said that its August sales rose 6 percent to $4.63 billion, but that same-store sales were up just 0.9 percent. The bulk of the growth came from the fact that Walgreen opened 561 stores between August 2007 and August 2008.
    KC's View:

    Published on: September 4, 2008

    Now available on iTunes…

    When I came back from vacation earlier this week, one of the stories that immediately caught my eye was one about how Tesco, prompted by an organization called the Plain English Campaign, is changing the language used at its express lanes in the UK.

    The use of “10 items or less” is considered to be incorrect because “less” means “not as much,” while “fewer” means “not as many.” And so, Tesco has decided to change the signs on the express lanes so that they read “up to 10 items.” Chalk one up for the English police…and I, for one, am glad that they are doing their job.

    I hope that more chains follow Tesco’s lead in this matter. Proper English ought to be used in every venue, no matter how small and no matter how inconsequential. And I’d like to see the industry be more consistent in its respect for language.

    And speaking of consistency…

    There was a story in the Arkansas Democrat-Gazette the other day about how Walmart isn’t being entirely consistent in how it spells its own name.

    You see, Walmart recently announced that it was changing its logo from the old “Wal*Mart,” which had a star between the “Wal” and the “Mart,” to a new spelling – Walmart, with no separation between the “Wal” and the “Mart” and using a lower case “m.”

    I, for one, took this very seriously and since that announcement have used the new spelling.

    The problem is that the logo hasn’t changed on most of the company’s stores, which is understandable because making that change is going to be pretty expensive. But it also hasn’t changed on the company’s press releases … and the confusion has meant that a lot of media outlets are still using the old spelling.

    Now, the company apparently says that the new spelling refers to the stores, and the old spelling refers to the company. But I’m begging the folks in Bentonville…please, make a decision.

    I can still remember years ago getting a press release that, as I recall, announced that the apostrophe in Albertson’s name was being eliminated…and I took that very seriously in my writings. But it still kept popping up with the apostrophe, even in some of the company’s press releases and subsequent coverage of the company.

    I hate that kind of inconsistency. I know this is a little thing, but it is an annoying thing that needs to be addressed.

    I repeat: I’m begging the folks in Bentonville…please, make a decision.

    Wal*Mart. Or Walmart.

    By the way, I try to practice what I preach.

    It’s MorningNewsBeat. Capital M. Capital N. Capital B.

    Always.

    For MorningNewsBeat Radio, I’m Kevin Coupe.

    KC's View:

    Published on: September 4, 2008

    MNB took note yesterday of two stories along the same lines…

    The Wall Street Journal reported that one of the casualties of the rising costs of food is likely to be people’s efforts to eat healthier food – since such products are, by their very nature, more expensive than less healthy foods. This won’t just impact people who are eating healthier by choice, but also people who are dealing with specific medical conditions.

    And, the New York Times had a story about how some parents are concerned about how the rising cost of food will impact the lunches eaten by their children – both the ones sent from home and the ones served by schools. The general feeling seems to be that increased costs are likely to result in decreased nutrition.

    I asked the following question: Is fresh fruit really more expensive than a bag of chips? Whole grain brad doesn’t have to be artisanal…if you look hard enough, there are other choices.

    One MNB user responded:

    People who consider food prices to be a disincentive to healthy eating aren't thinking about the high cost of a bypass or diabetes. It may be that the crunch right now feels too burdensome to consider whether other cuts might be worth the tradeoff to make sure healthy food stays on the plate, it may be the feeling that time is not available to learn about healthy cooking - or it may be sheer laziness. Someone who has a job with benefits can afford that $20 monthly prescription, after all, so why bother with healthy eating or exercise?

    But what happens when the company downsizes and the prescription goes to $100 a month? Does switching to healthier food make more sense then, if there is a significant component of the disease that can be managed through diet and exercise?

    I guess what it gets down to is that under it all, people are rational - they may not come to the same conclusions as you or I do, but there is a method to their madness.

    And regarding the lunch thing - duh? If input prices are going up but end user prices aren't (or are only going up a little bit), there's only so much economy you can get out of efficiency and worker productivity. Quality is a casualty eventually.


    MNB user David J. Livingston wrote:

    I totally agree with you that nutritious food does not have to be expensive. There is a store near me that sells bananas, onions, and potatoes for 39 cents a pound everyday. We have a farmers market that operates downtown twice a week and you can buy fresh fruits and vegetables for much less than at a supermarket and the quality is better. Aldi has several hundred SKUs of healthy products sold at rock bottom prices. Any lower and they would be giving it away.

    MNB user Richard Layman wrote:

    Healthier food doesn't have to be more expensive.

    "Healthier" food is more expensive if you define it as organic and other high priced items that can only be obtained at Whole Foods Supermarket. Less processed healthy foods cooked well are much cheaper than buying prepared foods.

    Supermarkets need to help us learn again how to cook, and how to cook healthfully, and at the same time, inexpensively. But it would mean less focus on processed foods, which tend to cost more (other than store brands, which are improving significantly in quality, taste, variety, and branding).

    Last night I made gazpacho using my blender and fresh produce purchased from markets. It wasn't organic. And the cost of producing a few days worth of soup myself was less than the cost of one bowl of gazpacho in a restaurant--and I am not a confident cook.

    The reality is that organically produced foods aren't much better for you than fresh or frozen foods. So why pay that extra money to Whole Foods anyway? And most of the time, food my wife and I prepare tastes better than what we get in the average restaurant, especially when you take service into account.


    Another MNB user wrote:

    I’m glad you said it. I couldn’t figure out how healthy eating was more expensive “by it’s nature.” It seems to me that with a little home cooking, healthy eating is cheaper!

    Instead of worrying about what the school is feeding your kids, take the time to pack them a lunch.



    KC's View: