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    Published on: January 15, 2010

    The National Retail Federation (NRF) is out with its year-end numbers, reporting that “retailers got the best Christmas present of all: a holiday season of gains, not losses. After a year that saw holiday sales decrease by 3.4 percent, retailers bounced back in 2009. According to the National Retail Federation, retail industry sales (which exclude automobiles, gas stations, and restaurants) for December rose 2.3 percent unadjusted year-over-year and fell 0.5 percent seasonally adjusted from November.

    “As a result, preliminary 2009 holiday sales, which combine the full months of November and December, rose 1.1 percent to $446.8 billion, surpassing NRF's projected decline of 1.0 percent.”
    KC's View:
    You have to take your successes when and where you can get them, no matter how small they may happen to be.

    Published on: January 15, 2010

    Delhaize Group has released new information about its reorganization efforts, which were reported yesterday on MNB.

    According to the announcement, “Each of the Delhaize U.S. banners – Food Lion, Harveys, Reid’s, Bloom, Bottom Dollar Food, Hannaford and Sweetbay – will continue to operate in existing locations, continue to serve customers under their respective names, and there will be no changes that affect customers.

    “Support functions for the banners will be part of the Delhaize America organization, the U.S. division of Delhaize Group, while maintaining the unique go to-market strategies of each of these banners.

    “The banner organizations will be supported by common U.S. shared services for corporate development, legal and government relations, information technology, finance, communications, organizational change management, human resources, strategy and research, and supply chain and procurement.”

    Rick Anicetti, currently CEO of Food Lion LLC, will serve as CEO of Delhaize America Shared Services and will have responsibility for the company’s corporate shared services functions. “Today’s announcement will further strengthen our organization and enable us to provide a greater focus on customers through a more efficient operation,” said Anicetti. “I look forward to leading the shared services organization that will serve our banner operations and identifying future business development opportunities to continue to propel the organization’s growth.”

    Ron Hodge, currently CEO of Hannaford Supermarkets, will serve as CEO of Delhaize America Operations and will have responsibility for all U.S. retail banner operations. “We remain strongly committed to continuing to serve our customers locally and ensuring that all banners deliver the excellent quality and great prices that our customers have come to expect from our company,” said Hodge.
    KC's View:
    With all these shifts, the most important words in the announcement are these:

    There will be no changes that affect customers.

    If that is job one, Delhaize will be successful. If the stores do not lose touch with their local markets, the odds are that these changes will help the company in the long-term.

    But those words - There will be no changes that affect customers - perhaps should be plastered all over the back rooms of all the Delhaize stores.

    Published on: January 15, 2010

    The Wall Street Journal reports this morning that Procter & Gamble “plans to launch an online store that will sell key brands, aiming to study consumer buying habits as it counters moves by traditional retailers, which have reduced the variety of brands they carry.” Only selected P&G products will be on the site, at least in the beginning.

    The site is located at www. pgestore.com, though it is not yet accessible to the public.

    The new eStore, as P&G calls it, is designed to be a kind of laboratory where the company can get in touch with consumers and their buying habits; it is not designed, according to the story, to be a big revenue generator.
    KC's View:
    Maybe not today. Maybe not tomorrow. But soon...?

    What was that we were saying earlier this week about disintermediation?

    Published on: January 15, 2010

    Hy-Vee announced that it has created a new joint venture with Amber Pharmacy of Omaha, Nebraska, to offer specialty pharmacy services through Hy-Vee's retail stores. Hy-Vee and Amber officials say the collaboration is the first of its kind in the industry.

    "Hy-Vee Pharmacy Solutions builds a bridge between two different segments of the pharmacy business," said Bob Egeland, vice president of pharmacy operations for Hy-Vee. "We're bringing together experts from retail pharmacy and specialty pharmacy to offer more convenient, more personalized service for patients with complex health care needs."

    According to the announcement, “Hy-Vee Pharmacy Solutions will support a wide range of complex, chronic conditions including oncology, blood disorders, Crohn's disease, growth hormone, hemophilia, hepatitis, multiple sclerosis, psoriasis, rheumatoid arthritis, and other chronic conditions. Because medications for these conditions are injected, infused, high-cost, or otherwise difficult to manage, most retail pharmacies refer patients to one of a few specialty pharmacy providers that have expertise in this area. Hy-Vee Pharmacy Solutions will help patients manage these conditions by assigning a health care team – an enrollment specialist, pharmacist, patient care coordinator, and billing coordinator – to develop an individualized plan for the patient's clinical care, insurance and financial administrative assistance, educational materials and resources, and follow-up care. This comprehensive approach allows patients to obtain all their medications and services from one source, resulting in greater adherence to the prescribed therapy, improved health, and faster recovery.”
    KC's View:
    Consider this story within the context of the next editorial piece...

    Published on: January 15, 2010

    A new report from the National Center for Policy Analysis (NCPA) suggests that  the number of walk-in clinics is expected to nearly triple in the next four years - to more than 3,200 - in response to increased patient demand.

    “These retail health care clinics offer evening and weekend care solutions at a fraction of the cost of emergency rooms and often charge less than a physician office visit,” said NCPA Senior Fellow Devon Herrick, who adds that “they are well-suited to patients wanting affordable, convenient care, especially after-hours and on weekends. And, these clinics are an easy option for some people without coverage or a primary care physician to get routine medical care without cost surprises. The prices are competitive and posted.” 
    KC's View:
    Let the Congress debate health care. Maybe the more important and impactful changes are taking place at retail.

    Published on: January 15, 2010

    Reuters reports that months after Nestle had to pull its refrigerated Toll House Cookie Dough out of stores because of concerns about E. coli contamination, two more samples of cookie dough tested positive, but was pulled from the line before being shipped. No cookie dough on store shelves is affected, the company said.

    At the same time, Nestle is saying that it plans to shut down its Danville, Virginia, plant for two days later this month to convert it to use heat-treated flour, which is far more resistant to E. coli contamination.
    KC's View:

    Published on: January 15, 2010

    The Associated Press is out with a story saying that the nation’s captivation with cupcakes is waning, and is likely to be replaced by a fixation on doughnuts, though this time around it is likely to be doughnuts using “gourmet flavor combinations and unorthodox ingredients.”
    KC's View:
    Pomegranate thyme doughnuts? Bing cherry balsamic doughnuts? Peanut butter and jelly doughnuts?

    Maybe I’m getting old, but these just don’t do it for me.

    Then again, I’m probably not the target demographic.

    Published on: January 15, 2010

    Every once in a while, something pops up on the internet that, while on the face of it hardly huge or momentous, deserves a mention because it speaks of something profound.

    In this case, it is a letter published in the Post Independent of Glenwood Springs, Colorado:

    “As I retire from Safeway, I would like to thank all the people that came through my line. Day after day, year after year, your smiles made my job more meaningful.

    As we go through life certain people make the difference. After 36 years as a checker for Safeway, 16 of those years here in Glenwood Springs, the people I have been able to wait on have made a good and positive impact on my life. I can only hope I was able to do the same for them.

    Thanks to Safeway and my Safeway customers for all the good years.”

    The letter was signed Peggy McKinster, to whom MNB wishes a happy retirement.
    KC's View:
    We make a lot of cynical comments here on MNB. Every once in a while, it is worth noting that there are good people out there who are working hard, people who don’t get a lot of credit but who touch people’s lives.

    Published on: January 15, 2010

    • The Houston Chronicle reports that Texas-based Brookshire’s is closing two of its Jackson, Mississippi, stores. Having reached an agreement to sell its two other stores there to Kroger, a deal that should close in May 2010, this new move will effectively take Brookshire’s out of the Jackson market.
    KC's View:

    Published on: January 15, 2010

    • Carrefour said yesterday that it has hired James McCann, who previously ran Tesco’s operations in Malaysia and Hungary, to head up its French business and be part of its top corporate management team.
    KC's View:

    Published on: January 15, 2010

    We talk about Amazon.com here on MNB, and one reader explains why:

    I cannot tell you how many times I’ve ordered things from amazon.com – appliances, food, etc. – not just books and DVDs  – because:
     
    It’s easier.

    I tend to look there first, because of this.  Sure, I’ve ordered from other sites and shop brick and mortar too.  But I tend to check amazon.  They’ve got me.  A loyal customer.  Someone on your site mentioned ‘the coolness factor” – it’s so true. I’ve been to their buildings, when I used to do some business with them (job and focus change, don’t any longer). They have such a great energy in their offices, very  creative, upbeat, happy.   Bunches of what looked like 20 and 30 somethings wandering around, all with purpose and focus.   In fact, some of the walls have white boards on them, where staff can spontaneously jot down creative ideas for later discussion.  How cool is THAT?  Like coloring on the walls!  The whole culture there felt like anything is possible, and no ideas were wrong or bad. 
     
    Prime member, one click shopping, find, click, move on.  It shows up a few days later.  And those “get it in two days, free shipping”!  Wow, the convenience and no hassle factor count for a lot.





    Responding to yesterday’s piece that attempted to draw lessons from the Leno-Conan controversy, MNB user Chris Muller wrote:

    Your message this morning, "Late Night Lessons" is nothing short of brilliant.  Great thinking, great writing.  Wish I had done it instead.
     
    Thanks for the effort.


    My pleasure.

    Another MNB user chimed in:

    When NBC promised Conan the Tonight Show it was a talent retention strategy, not a ratings strategy.  The decision was probably made in a vacuum and the ratings "strategy" conjured up after the fact.  While talent and ratings are closely related, there are two reasons it's important to make this distinction among strategies:  1) many other things impact both ratings and talent retention,  2) a ratings strategy related to talent should start with a genre of talent, not the name of an individual.

    Also notable in this mess is NBC's apparent paradigm of ratings first, people second.  Mistake one:  NBC promised what they can't or aren't willing to deliver.  Mistake two:  NBC has pimped the private, personnel matter of contract breech/renegotiation to the court of public opinion as a trial balloon for new late night "strategies."  One word for mistake three: culpability.  How about NBC just saying, "we made a bad call and here's what we're going to do to fix it?"  This was an opportunity to demonstrate integrity and build credibility and they blew it, again.


    MNB user Kayla M. Anderson wrote:

    I had to echo the folly of NBC’s Conan & Leno issue.

    I saw their decision as a choice between markets.  The boomers love Leno, and it’s true--he’s a skilled host.  But Facebook and twitter are ablaze with Gen Y’s support for Conan.  An industry that is daily losing young viewers (and hence, their future) to the internet, Hulu, Netflix and cable successfully hammered another nail in its coffin.  Amid their shaky arguments, Gen Y heard only one thing from NBC:  We’re eliminating your go-to guy, and bringing back your parent’s show. Watch something else.

    To me, this is another fatal blow to network television.  This decision signifies a resistance to change, a sadly redundant theme in TV land…  Good bye television, there are too many other, better muses to entertain me while you sort through your relics.


    I made a joke yesterday about Art Fern running NBC, which prompted one MNB user to write:

    All right, I'll bite.  Who or what is Art Fern?

    Only one of Johnny Carson’s more memorable characters, who simply dripped sleaze. Check him out on YouTube or Google Video.

    MNB user Steve Sullivan knew who he was:

    NBC got to the Slausen Cutoff and cut off their slausen!

    You are correct, sir!
    KC's View:

    Published on: January 15, 2010

    Today’s a big day for us. It is the official publication date for “The Big Picture: Essential Business Lessons from the Movies.” Yippee!

    And, we’re now available on Amazon.com. To check it out, click here > .

    If you read the book and like it, do us a favor and do a reader’s review on Amazon. It’ll help enormously to spread the word...
    KC's View:

    Published on: January 15, 2010

    For those of us who pay attention to such things, there has been much speculation about whether Apple is about to introduce a new tablet computer later this month, a piece of technology that could do things like give newspapers, magazines and books a new platform on which to be read, could provide a new way for people to engage with movies and television shows, could...well, the thing is, nobody knows what the new tablet computer could do, or if it will have the same kind of impact as Apple’s iPhone. If indeed it even exists. Because while there has been a lot of speculation about Apple’s tablet computer, Apple hasn’t said anything. Yet.

    Daniel Lyons has an excellent column in Newsweek about this subject, in which he makes the following observations:

    “The cool thing about technology is that nobody ever knows how new ideas will evolve. Today's hype around the tablet is a lot like the hype around the iPhone before its 2007 introduction. Back then, just like today, everyone was trying to guess what it would look like and what it would do—and as it turns out, nobody was even close.

    “The lesson we've learned since then is that even the people who created the iPhone could not have imagined what people would do with the device. Much of the fun of iPhone involves software apps that didn't exist when the iPhone was introduced. Those apps don't come from Apple—they were written by thousands of developers who found inspiration in a new computing platform.”

    That’s one of the real advantages that technological innovation has - it has the ability to breathe and evolve.

    It may be harder to do in other venues, like retail, but it seems to me that this is an advantage worth pursuing - understanding that a business innovation is only a starting point, and embracing the notion that even greater innovation can emerge from how people - suppliers, customers, employees - respond to the starting point and transcend it.

    I’m not sure how you do that, if you have a store or a new product. But if you can figure out a way, perhaps the result would be a laboratory for continuing innovation in which all parties feel like they have skin in the game.

    To some very small degree, I always think that this is what has happened here on MNB. WE’re a very different community than we were when we started eight years ago...and to a great degree, that’s because I’ve learned so much from the people who read the site and write in...hundreds of emails every week...offering opinion and context and observation. I think people do that because they feel like this is, as a reader once admonished me, their site, not mine. And how could I not learn and grow with that kind of input?




    Another thought on the whole Leno-Conan imbroglio...

    Is it possible, when all is said and done, that the ultimate problem here is that few people really understood the power of a great brand?

    Maybe NBC executives didn’t really understand the level of the national commitment to the idea of the “Tonight Show” brand, even among people who hadn’t watched it since Johnny Carson was on, which is why the story has become so enormous.

    Maybe Conan O’Brien didn’t understand that his brand identity didn’t really fit into the 11:30 pm time slot.

    And maybe Jay Leno didn’t understand the hit that his brand would take by being part of the whole controversy.

    It’s a mess. It’s a car wreck. And it is an enormous kick to watch.



    Speaking of a kick to watch...

    On Sunday, after the Jets game, “24” returns.

    Can’t wait.




    Had a wonderful wine the other night - the 2007 Boxcar Syrah, from Sonoma, which is very, very smooth and goes for about $18 a bottle. Just yummy.




    “It’s Complicated,” written and directed by Nancy Meyers, is never going to be confused with anything created by Billy Wilder (Some Like It Hot) or Ernst Lubitsch (The Shop Around The Corner). But that doesn’t mean that it is without merit or humor ... in fact, it has moments that are very, very funny and also offers a particularly important business lesson.

    The plot is simple. A Santa Barbara woman (Meryl Streep) who has been divorced for 10 years finds herself in an affair with her ex-husband (Alec Baldwin), even as she is attracted to a local architect (Steve Martin) and trying to cope with empty nest syndrome.

    Now, there is a theory out there that what Nancy Meyers makes are movies (previous efforts include hist such as What Women Want and Something’s Gotta Give) that can be characterized as “Pottery Barn porn” - they are so heavily and specifically designed that it seems like she pays as much attention to the wardrobe and the color of the walls as she does to the performances of the actors. I’m not entirely sure that this is a fair criticism. After all, since when did specificity of design become a negative in the movie business? What some people may resent is that her vision is so relentlessly upscale, but movies have for years offered a peek at how the upper class lives.

    Meyer’s real achievement, it seems to me, is that she makes movies for a demographic rarely targeted by the movie business: Boomer Women. Her movies generally feature strong Boomer Women dealing with aging Boomer issues, and Boomer women tend to flock to them. She’s also smart enough to populate her films with strong male characters - played by actors such as Jack Nicholson or Mel Gibson - so that guys don’t mind tagging along.

    So these are the business lessons. One, don’t be afraid of specificity of design. A business, like a movie, should have a strong sense of place. And two, sometimes it makes sense to target demographics that the competition sees as undesirable or irrelevant...because there can be gold discovered there.

    As has been noted elsewhere, the best thing in It’s Complicated is Alec Baldwin, playing Meryl Streep’s hound dog ex-husband who finds himself yearning for his ex-wife while he tries to survive an unsatisfying second marriage to a young bombshell. He’s big and unapologetic and seductive and extraordinarily charming...and Baldwin reinforces the notion created by his work on “30 Rock” that he may be the funniest comic actor working today.

    Streep is every bit his equal, and Steve Martin also is good, though it seems fairly obvious that he’s had a little too much work done on his eyes, which is distracting.

    If you’re in the food business, check out the scene where Streep teaches Martin how to make a chocolate croissant. It’s magic.



    Other movies to see...

    Invictus is sort of standard Hollywood fare when it comes to onscreen biographies, but it is made special by two excellent performances, by Morgan Freeman as Nelson Mandela in the early days of his leadership in South Africa, and Matt Damon as the rugby player he enlists to help bring the country together. The movie is directed by Clint Eastwood, who continues to try new things as he approaches his 80th birthday. And I found myself moved by a story that is very much personality-driven.

    The most resonant criticism of The Blind Side is that it takes the usual Hollywood approach - a poor young black kid is rescued through the charity and altruism of rich white people. And that’s a very fair observation. The thing is, The Blind Side is also enormously enjoyable. In part, that’s because it is based on a true story about Michael Oher, an impoverished young man who is befriended and eventually adopted by a wealthy family. Sandra Bullock plays the matriarch of the family, Leigh Anne Tuohy, and she is a force of nature - it is a big, showy and fun portrayal. And Quinton Aaron is touching as Oher.

    The real Michael Oher, by the way, plays for the Baltimore Ravens...and he’ll be on the field this weekend playing against the Indianapolis Colts.




    That’s it for this week.

    Have a great weekend, and I’ll see you Monday.

    Slainte!
    KC's View: