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    Published on: August 11, 2009

    by Michael Sansolo

    Twenty-plus years ago, I recall a very strange political moment. As the film “The Right Stuff” came to theaters, there were those convinced its portrayal of the early American space program would propel heroic astronaut-turned-Senator John Glenn into the White House. Do you remember President Glenn?

    It’s worth thinking about as we consider the moment surrounding the release “Julie & Julia,” starring of Meryl Streep as Julia Child. Yes, it’s a celebration of cooking and food that should give all of us pause and might get some folks back into the kitchen. But as “Content Guy” Kevin Coupe suggested yesterday, let’s not get crazy. Streep has made countless terrific movies and unless you credit her for the rising divorce rate after “Kramer vs. Kramer,” it’s hard to see how a film changes the world.

    Then again, maybe we should pause and think about it this time. It’s not the movie, but the timing that should interest us. For nearly a year now, the US (and most of the globe) has been immersed in the worst economic crisis since the Great Depression. For a year now we’ve heard and read countless reports about how the crisis is altering consumer behavior, building frugality and leaving people looking for lifestyle changes.

    Which means that for nearly a year now opportunity has been staring us in the face and asking us whether we are going to act. “Julie & Julia” is simply the latest reminder.

    The reality is that Americans aren’t rushing back into their kitchens to battle the economic crisis. They talk about eating more meals at home, but there is plenty of evidence to suggest the move is minor and the larger move is toward economizing at home and at restaurants. (McDonald’s sales are up, for example.) But that again is the opportunity.

    The reality is also that people’s habits do change in times of economic crisis and they can stay changed for years afterwards depending on how scarred they are by the experience. It’s hard to imagine that two years from now, Americans will be buying up homes as they recently did, hoping to flip them quickly into massive profits. Two years from now we have to hope banks and lending institutions won’t be finding creative (and ultimately destructive) ways to support those actions.

    However, that’s not our business. Our business is selling food, so let’s start thinking about where we want to be when the economic crisis passes. Do we want to return to watching idly as sales and meals continue to drift away from home or do we want something bolder?

    The economic crisis is a moment that (hopefully) won’t come along for a very long time. It’s a time for re-evaluation, but also reconnection. It’s a time to abandon the status quo and find the new path to success and customer satisfaction.

    Ask yourself a hard question: what are you and your company doing differently today compared to last August? In the year since Lehman Bros. collapsed, the Dow Jones tanked and the world shifted, what are you doing differently? What are you doing with shoppers, associates, trading partners and communities? How have you used this moment to alter the future?

    If you haven’t done any of that, consider your competitors who have. Consider the brilliance of Walmart’s strategy to demonstrate customer care through the economic crisis. Consider McDonalds new upscale offerings in coffee and burgers and think about how that company is seizing market share by redefining value. And while those are just two examples, both pack an enormous punch.

    And then ask, what have you done, how have you changed and how have you built the new relationship. The moment is here, but the moment may soon be ending. The time to act is now.

    Michael Sansolo can be reached via email at .
    KC's View:

    Published on: August 11, 2009

    Advertising Age reports that the manufacturer trend toward reducing package size without lowering prices may shortly undergo a reversal. It is anticipated the lower commodity costs will allow them to either increase package sizes and perhaps advertise their products as offering additional product for free.

    It is not entirely clear whether these changes will be permanent or simply promotional, and the determination may be made by 1) how consumers react, 2) how commodity costs continue to go up or down, and 3) what the competition does.
    KC's View:
    There apparently are at least a couple of cases where consumers have not reacted well to all these shifts, noticing the manufacturers are claiming credit for offering free product as a promotion when all they have done is return package sizes to previous levels. And manufacturers have to be careful about the appearance that they are being less that forthright with shoppers, who don't always appreciate being manipulated.

    But this story continues to prove that the pundits were wrong when they claimed just a year or two ago that prices were going up and never would come down again. First of all, you never say never. And second, you should never underestimate the power of consumer demand…and consumers were never going to stand for increased prices during a recession.

    Published on: August 11, 2009

    The Phoenix Business Journal reports this morning that bankrupt Bashas’ Supermarkets wants to close 14 stores as part of its restructuring efforts, which will be in addition to the 15 other stores already slated for closing.

    According to the story, Bashas’ needs court approvals in order to void the leases for the stores.

    The journal writes that “Bashas’ officials have been examining company operations from top to bottom and identified these locations for a variety of reasons, including low sales volume, not performing up to expectations and the cost of maintaining the locations … In addition, some of the stores are operating in areas previously identified as new growth areas, but the housing meltdown has significantly slowed housing development there.”
    KC's View:
    It is clear that Bashas’ isn’t going to be the same company when it finally emerges from bankruptcy, which I guess is the ultimate point.

    But the question – which hasn’t yet been answered, and won’t be for some time – is whether what remains at the end of the process will be a viable and differentiated company that will retain whatever brand equity it had in the marketplace.

    Published on: August 11, 2009

    CobornsDelivers, the online grocery business created when Coborns acquired Simon Delivers last year, announced it has begun delivering groceries directly to the Southwest Park and Ride Lot located at 13500 Technology Drive in Eden Prairie. The service is the first of its kind in Minnesota, and free for orders of $25 or more.

    “Busy commuters can order their groceries online at CobornsDelivers by
    10:00 in the morning, and we will have them there fresh and ready to pick
    up as customers get back in their cars to head home that evening,” said
    CobornsDelivers Vice President of e-Marketing, Sue Westerman. “Our insulated totes keep everything fresh, cold or frozen for hours, and our delivery truck will be at the park and ride lot every weekday from 3:45 – 7:30 p.m.”

    CobornsDelivers has been expanding its business in recent days, having recently extended its service area to reach more of the greater Twin Cities metro area that used to receive the service when it was SimonDelivers. And it has also has begun offering pick up service at its Superstore in New Hope, Minnesota.
    KC's View:
    The good news is that I meet fewer people these days who think that the e-grocery business is a flawed model. There are a few of them out there, but not many. The simple fact is that among the companies I talk to, pretty much everyone who has a pick-up model seems to be happy or satisfied with it, finding it to be profitable. (The delivery model has economic challenges that have not always been alleviated, depending on the company.)

    I continue to believe that retailers without any sort of e-commerce model are making a mistake, because they are not anticipating inevitable changes in what consumers want and how they want it.

    Published on: August 11, 2009

    The St Petersburg Times reports that Public Super Markets will be closing five existing units in markets that will be better served by some of the 17 Albertsons stores that the company bought about a year ago. Ten of those Albertsons stores have been rehabbed and reopened; the other five are expected to be done by the beginning of next year.

    “We'll close them because the stores had grown too old and tired," said Shannon Patton, Publix spokeswoman.
    KC's View:

    Published on: August 11, 2009

    • The Arkansas Democrat/Gazette has an interesting story about how Walmart is utilizing local farmers throughout the US, serving as both a way to cut down on the miles between farm and fork and a way for Walmart to differentiate and distinguish itself in the food business.

    The story notes that Walmart buys about 70 percent of its produce from U.S.-based suppliers, but that those in the know seem to feel that more can be done – that better communication and coordination can create a connection between retailers and local farmers that will have both economic and environmental benefits.
    KC's View:

    Published on: August 11, 2009

    Marketing Daily has a story about how Michaels Stores – the craft store chain – is sponsoring a event at all its US and Canada stores this weekend, offering a workshop that allows kids to make and decorate their own pencil cases in anticipating of going back to school in the next few weeks.

    The story notes that craft stores have been pretty much holding their own during the recession, and part of that seems to be because they have been aggressively and effectively marketing through email blasts, circulars and in-store materials.
    KC's View:
    I bring this up because I wonder how many supermarkets might be holding workshops over the next few weeks to teach kids to make their own lunches.

    It’s a good idea, I think. Somebody ought to do it.

    BTW…the COO at Michaels is the estimable Shelley Broader, who used to be CEO at Sweetbay Supermarkets. And I’d be willing to bet that she has her fingers in this promotion, simply because this is the way that Shelley Broader thinks.

    Published on: August 11, 2009

    Crain’s Chicago Business reports that Walgreen CEO Greg Wasson plans to channel McDonald’s as he grows the drug store chain – he wants to slow down unit growth while reinvesting in existing stores in a way that makes them more relevant to shoppers.

    According to the story, “Walgreen is scrubbing down stores, as McDonald's did. Based on feedback from consumer focus groups, Mr. Wasson is changing layouts to make shopping more convenient. And he's reducing the selection of items stocked in stores, on the theory that offering too many choices frustrates customers and creates clutter. He's retooled advertising to emphasize basics like soda pop and paper towels.”

    And, while Walgreen ants to increase the number of in-store health clinics that it operates, Wasson says he has no intention of following the path of rival CVS, which bought a pharmacy benefits management company and is integrating its operations into the overall company.
    KC's View:

    Published on: August 11, 2009

    • The United Food and Commercial Workers (UFCW) has charged Louisiana’s Rouses supermarkets with obstructing its workers’ first amendment rights of freedom of speech as they express interest in joining the union.

    • Circle K, a subsidiary of Canada-based Alimentation Couche-Tard, reportedly plans to sell 87 US locations that don't fit into its long-term growth and development plans.
    KC's View:

    Published on: August 11, 2009

    • Eunice Kennedy Shriver, younger sister of President John F. Kennedy and founder of the Special Olympics, died early this morning at age 88 after a long illness.

    Shriver was awarded the Presidential Medal of Freedom, the nation's highest civilian honor, by President Ronald Reagan in 1984.
    KC's View:

    Published on: August 11, 2009

    MNB took note yesterday of a new McClatchy-Ipsos poll suggests that while obesity may be in a problem in the US, most people don't believe it – only 17 percent of those surveyed said that they thought obesity might be a serious problem for themselves and their families and that two-thirds felt their weight was “healthy” –which is at variance with the national trends that put US obesity rates at between 25 and 30 percent.

    My view: This could be simple denial, or it could be the tendency of many Americans to not believe what the government tells them. Which seems to be a tendency growing by the minute.

    MNB user Linda Allen wrote:

    Is "denial" your generation's word for psychological "predisposition" or heaven forbid "fact?" People demonstrably have a strong psychological tendency to believe that whatever they are or are not is OK. It is just "everyone else" that has a problem with "it." My personal belief as well is that people have monumental problems dealing with anything that involves their appearance. Although obesity is truly a very serious health issue, for many bright and well-educated adults, it continues to be first and foremost a question of "what do I look like" or "what does (my significant other) think I look like." And like alcoholics, many overweight people never get beyond that emotional response to a solution.

    The real tragedy is the increase in childhood obesity that in many cases is encouraged by the failure of obese/overweight parents to change their own unhealthy eating and/or exercise habits. Not an easy task. I would still be smoking had research not clearly indicated that the children of parents who smoke are far more apt to be smokers. Guilt is a tricky motivational tool, but sometimes it works.

    Another MNB user wrote:

    Who needs the government to tell us about the national obesity problem. Much like we don't need them to tell us about the mating habits of the spotted owl. Go to the malls, the movie house, car lots, grocery store etc...we are over fed and under exercised. It's amazing what we've become. Super size drinks, popcorn, candy, meals etc leads to one thing and one thing only; super sized people.

    And still another MNB user wrote:

    Maybe government figures can or cannot be trusted…but go to any public place and your eyes will tell you the 25% to 30% is way low.

    Like water parks.

    Got the following email from MNB user Calvin Mayne:

    I enjoyed your piece about Julia Child, especially about her making food accessible. In fact, that’s our philosophy: eating good food is not a about snobbery. It’s about learning, experiencing, sharing one of life’s great pleasures. It’s our raison d’etre beyond making money, and several of our friends in the business share this view. By the way, I also went to Le Cordon Bleu in Paris…some 10 years ago, and took the 10 week course in Basic Cuisine. Lardons are cubes of uncured bacon, fat intact. French supermarkets sell them already cubed in convenient packages. They are ubiquitous in French cooking. For example, lardons are one the reasons a quiche lorraine tastes so good in France.

    I get hungry just thinking about it. And by the way, this kind of experience and knowledge is one of the reasons why Mayne’s Dorothy Lane Markets are such special places to shop.

    We had a story yesterday about what may be an incipient trend – wine in plastic bottles.

    I wrote, after decrying this as evidence that end of civilization is at hand: I’ve just now adapting to screw tops. I’m not sure I can handle boxes and plastic bottles of wine.

    And I continue to worry that we are bleeding the magic out of wine, that by getting rid of things like corks and heavy glass bottles, we make it less special. We make it like milk or soda. And I’m not sure that in the long run, this helps the wine business.

    MNB user Steven Barry wrote:

    In regard to your comments about the plastic wine bottle, you really should read your comments for yourself even though, you did type it. You sound like an elitist who is just now noticing that certain undeserving types are now being allowed into your little, once exclusive, club.

    What’s the big deal? You’re not the only one that can appreciate wine. Why not make it more affordable? Don’t worry; these plastic bottled wines will not change the taste or stature of the wines that you can afford.

    First of all, I read all the words I write. I don't always notice the misspellings, and I sometimes misjudge the tone, and I even occasionally make jokes that end up not being funny.

    This wasn't one of those times.

    I don't think I was being elitist. I was just saying that, in my humble opinion, wine has a magic that most other beverages don't have. “Wine is sunlight held together by water,” is the way it is described in the terrific movie ‘Bottle Shock.” And my fear is that by putting into cardboard boxes or plastic bottle, we somehow drain it of the magic…which should be available to everybody.

    On the other hand, if this makes me elitist….c’est la vie.

    I like the way MNB user Ken Wagar puts it:

    Although I drink very little wine and don’t really care how it is packaged and sold I really thought your comment … was a great one and could be applied to many products, businesses and life experiences … I think we are really good at bleeding the magic out of many things helped along by economics which sometimes causes us to make compromises that reduce the magic. One can’t help but think that certain Starbucks and Whole Foods actions over the years made them less special. Makes me wonder if Tide Basic might do the same to Tide.

    Has TV bled some magic out of children’s life experiences, has the internet done the same? Each of these have produced a certain magic as well I guess but I think your statement is thought provoking and can be turned into a question we should be asking about many things that change whether that change is driven by economics, technology or simply poor decision making.

    And I agree with MNB user Lisa Malmarowski:

    One word - gross. I hate, hate, hate beer in plastic and this is worse. (Okay, guess that was more than one word!)

    Sure, but who’s counting?

    Finally, on the Whole Foods resuscitation, some pithy words of wisdom from MNB user Dean Sparks:

    Something to be said that in November Whole Foods stock was trading at $7 and is now trading at $28.
    KC's View: