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    Published on: April 23, 2010

    The Arizona Republic reports that six Pro’s Ranch Market stores in the Phoenix area had to let go some 300 employees this week after they were found by the US Immigration and Customs Enforcement agency to be working illegally in the US.

    According to the story, the employees are able to appeal the decision but cannot work during the process. A Pro’s Ranch Market spokesperson said that the former employees apparently used forged documents to get their jobs, and that the company had complied with all laws and requirements. However, the Republic notes that the retailer could face fines in the case.

    The Republic also reports that terminated employees were given “packets containing an immigration resource list, parting message from the company's president and a $250 grocery gift card.”
    KC's View:
    Tough times for Pro’s Ranch Markets, which now has to replace 300 employees and deal with the perception that it was giving American jobs to illegal workers in a state where immigration is, to say the least, a hot button issue.

    It is important, of course, that the federal government enforces immigration laws. I am more troubled by the state legislation now on the Arizona governor’s desk that would require local law enforcement officials to determine whether people are legal or illegal based on suspicions; I’ve seen people on TV saying that cops are perfectly capable of deciding whether to ask for documentation based on how a person looks, whether it is how they comb their hair, or what kinds of shoes they are wearing. (Really?)

    This strikes me as a disaster waiting to happen. It won’t be long before the wrong person gets arrested, and a lawsuit gets filed against the police, and issues of racism and abuse bring a simmering issue to a full boil. And it won’t be pretty.

    Published on: April 23, 2010

    The Organic Trade Association is out with its annual survey, revealing that despite the recession, “organic product sales in 2009 grew by 5.3 percent overall, to reach $26.6 billion. Of that figure, $24.8 billion represented organic food. The remaining $1.8 billion were sales of organic non-foods.” Other info from the survey:

    • “Experiencing the most growth, organic fruits and vegetables, which represent 38 percent of total organic food sales, reached nearly $9.5 billion in sales in 2009, up 11.4 percent from 2008 sales. Most notable, organic fruits and vegetables now represent 11.4 percent of all U.S. fruit and vegetable sales.”

    • “The mass market channel had the lion’s share of organic food sales in 2009, with 54 percent of organic sold through mainstream grocers, club stores and retailers. Natural retailers were next, with 38 percent of total organic food sales. Although still representing a small percentage of sales, farmers’ markets, co-ops and CSA (community-supported agriculture) operations gained a lot of interest as consumers increasingly look for locally and regionally produced organic foods.”

    • “Since the approval of the final National Organic Program rule published in 2000, sales of organic fruits and vegetables have grown from $2.55 billion, representing approximately 3 percent of all fruit and vegetable sales, to the nearly $9.5 billion level and 11.4 percent penetration level. Meanwhile, during that time, organic food sales have grown from $6.1 billion to $24.8 billion in 2009, jumping from 1.2 percent of all U.S. food sales to 3.7 percent.”
    KC's View:

    Published on: April 23, 2010

    Reuters has a very interesting story about how Procter & Gamble could run into a social media buzz saw with its release of new diaper technology.

    According to the story, one mother named Carol Valentine says that “she may never buy a P&G product ever again. Her four-month old daughter had been in Pampers Swaddlers diapers since the day she was born. Earlier this month the Michigan mom started to use a box of the newest P&G diapers with ‘Dry Max’ technology that is touted as thinner and more absorbent. Soon, her daughter's skin in the diaper area turned pink. By the next day, blisters had formed.

    “Nothing in baby Alexis's routine had changed except that the family started using the new Pampers Swaddlers, Valentine said. A pediatrician diagnosed it as a chemical burn and one week later the area was still bleeding when touched, she said.”

    Now, to be fair, to this point the Dry Max technology has been successful for P&G, which goes so far as to say it has been a “blockbuster start.” And on the company’s Pampers Facebook page, there are more than 200,000 fans, as opposed to the barely more than a thousand people who have taken to the internet to call for the technology’s recall. And P&G maintains that it tested the technology sufficiently and is confident that there are no dangers.

    But...Reuters also says that “dozens of parents on Pampers websites, forums such as Facebook and online retailers including Inc and, say that even though the diapers are supposed to be more absorbent, they leak more and feel stiff. And while P&G says it is not receiving an unusual amount of complaints given the introduction of a new product, the negative discussion can take on a life of its own ... Some of the consumer anger stems from surprise over P&G's formulaic response to complaints ... when the latest complaints arose, some say Pampers replied with form-letter types of responses.”
    KC's View:
    It doesn’t sound like the complaints will be enough to scuttle the Dry Max technology, but I suspect that P&G may want to remain highly engaged with the conversation about it online. The worst mistake the company - or any company - can make is to not deal with something when it is a small problem, and wait until it has become a big problem.

    Published on: April 23, 2010

    Drug store chain Rite Aid said yesterday that it has signed a deal with a company called American Well, which it said will enable patients “to access live, interactive online consultations with Rite Aid pharmacists from home and from private consultation rooms in a select number of Rite Aid pharmacies ... Patients will be able to initiate consultations from the convenience of their home or in select stores, using the Web or a regular phone. During each consultation, Rite Aid pharmacists will be able to review the patient's history, speak with and see the patient and provide medication consultations and advice. The system will automatically compile a full record of each conversation when completed, supporting care continuity.”
    KC's View:
    This supports one of MNB[s core mantras - that it is important to be not such a source of product, but a resource for information.

    Published on: April 23, 2010

    The Grand Rapids Press reports that Meijer has introduced a new fleet of near-zero emissions trucks.

    According to the story, “Meijer began taking delivery today of the nation's first fleet of the trucks, which meet the new Environmental Protect Agency's 2010 standards, from Daimler Trucks North America that feature near-zero emissions technology.

    “Meijer purchased 75 Freightliner Cascadia trucks equipped with DD13 engines that represent a family of new fuel efficient, reduced-emission engines developed by Redmond-based Detroit Diesel in collaboration with the Department of Energy 21st Century Truck Partnership program. Meijer's new fleet improves fuel efficiency while reducing emissions to near-zero levels of nitrogen oxides.

    “With the delivery of these trucks, Meijer will operate the largest 2010 EPA Emission Compliant Fleet in North America.”
    KC's View:
    More fuel efficient and producing fewer emissions? Sounds like the prototypical win-win to me...and yet more proof that “green” can have multiple meanings and profound implications.

    I trust that Meijer will be trumpeting the advantages of this fleet on the side of every trailer...which it should.

    Published on: April 23, 2010

    In Charleston, South Carolina, the Post & Courier reports that the 17-store Earth Fare supermarket chain has decided to no longer offer plastic bags to shoppers, saying that from now on it will only offer paper bags, cardboard boxes or reusable tote bags.

    "Every time someone doesn't use a plastic bag, it makes a difference in our environment," Earth Fare spokeswoman Dorothy Carlow said. "It takes them 500 to 1,000 years to degrade."

    Whole Foods made a similar move two years ago.
    KC's View:
    Not sure that every supermarket chain can or even should make such a move at this point, but it is certainly consistent with Earth Fare’s strategic positioning to do so.

    Being one of those people who is religious about bringing reusable bags into the supermarket, I certainly approve.

    Published on: April 23, 2010

    Crain’s Chicago Business has a story about a company called Cardlytics, which is taking an aggressive approach to targeted marketing. Here’s how the story describes it:

    “Imagine signing in to your online-banking account and finding promotions linked to your transactions. Underneath a transaction for a restaurant, there's an offer from that eatery for $10 cash back when you spend a minimum of $20. And underneath a purchase at an apparel chain, a rival offers 15% cash back for shopping at its store or website.”

    According to the story, Cardlytics “claims that advertisers, consumers and financial institutions are fast embracing this new advertising model (and) says it has run more than 100 marketing campaigns reaching nearly half a million customers. By the end of the summer, the company expects to have 50 to 70 financial institutions on board, reaching some 10 million customers by the end of the year.”

    While the company acknowledges that there are privacy concerns, it addresses them by saying that the individual card data remains behind the banks’ firewalls ... it is simply serving as a matchmaker based on data sets. And, it says, customers can opt out of the program...though in tests, the opt out rate has been under five percent.

    Cardlytics gets paid for performance - it only gets a fee when customers redeem a coupon or use a coupon code.
    KC's View:

    Published on: April 23, 2010

    Fox News reports that Burger King is testing a new brunch menu in a number of markets, offering items such as a ciabatta sandwich and a breakfast bowl in addition to its standard menu. In addition, it is offering what might be called a virgin mimosa - described as a orange juice and Sprite as opposed to OJ and champagne.
    KC's View:
    My definition of depressing would be having breakfast and a fake mimosa at Burger King.

    I say this as someone who thinks that a Buck’s Fizz, served either with french toast or an omelette made with cheese and thinly sliced chorizo sausage, is the perfect way to lift one’s spirits on a Sunday morning.

    Published on: April 23, 2010

    • The Wall Street Journal reports this morning that PepsiCo “is launching a new ad campaign during Friday night's NBA playoffs meant to boost its struggling Gatorade business by getting athletes to gulp its iconic sports drink before, during, and after the game.

    “The campaign, promoting the Purchase, N.Y., food and beverage giant's new lineup of "G Series" drinks for athletes, aims to demonstrate that Gatorade isn't just a sports drink that replaces nutrients sweated out during the game, but a system with three steps: a carbohydrate-loaded "Prime" concentrated liquid before play; the traditional "Perform" sports drink during; and a light, protein-rich "Recover" drink after.”
    KC's View:

    Published on: April 23, 2010

    We continue to get email about the report about Supervalu reducing items in 10 major food categories by 20 percent, a move intended to leverage lower costs with suppliers and free up shelf space for the grocer's private-label products.

    My feeling was that this seemed similar to what Walmart recently tried to do, but had to back off from; the emails posted here yesterday suggested that this is an ill-conceived idea that has more to do with using leverage to generate higher slotting fees and promotional allowances than it does with creating a compelling in-store shopping environment.

    One MNB user continues the conversation:

    I enjoy that every manufacturer chimes in and claims that slotting fees caused this and that all that SVU is looking at when reducing skus is vendor funds. Most of that is probably true. What no one is getting at is why are they doing this now...

    It has ZERO to do with consumers. It has ZERO to do with funds. They will lose many customers and they will lose MASSIVE Vendor funds.

    They are doing this because the centralized group can't manage the business. Too many banners are too unique.

    If they eliminate the uniqueness and make the assortment the same across all banners, they think they will be able to get their jobs done. There are rumors that more announcements are coming to eliminate corporate positions in the banners and that ALL control will be in Minnesota. Local relevance will be gone (as if it was ever planned to stay).

    But another MNB user disagrees with some of the carping:

    I think we’re being a bit cynical regarding Supervalu’s decision to reduce the number of SKU’s it carries on their shelves.  Everyone is jumping to the conclusion that Supervalu will be axing national brands and/or popular products in the name of slotting fees and ad funds.  I have no doubt that this undertaking will result in some people’s “favorite” products being eliminated from the shelves which will be frustrating and annoying to those customers.  I think the bigger picture is to reduce the redundancy in any one product or brand and not necessarily just the number of brands.

    Fewer products…..more importantly fewer variations of the same product results in fewer out of stocks, fewer products to stock, fewer items to order for a store, fewer items to ship to a store, fewer items to stock in the distribution centers….etc.  All of this will, hopefully, result in higher volume/turnover of the products that are on the shelves, less waste and lower prices.

    Seriously, are we really going to miss the choice of an 12oz, 14.5oz, 16oz, 24oz and 32oz, and 102oz can of tomatoes on the shelf...

    You may be right. But the common theme in many of the comments I’m hearing is that Supervalu is becoming Fleming...and that part of the problem is that much of the institutional memory has been purged in recent months.

    Now, let’s be fair. Supervalu is operating in a different economic climate than the one in which Fleming collapsed. It could succeed in ways that Fleming did not. It could succeed at doing something that even Walmart was unable to do.

    But to ignore the failures of the past is to risk repeating them.

    The discussion will continue, no doubt. Here, we’re just thrilled to be part of it...and were pleased by this email that we got yesterday:

    I was just reading the reader comments this morning and had to say—this is great stuff. 

    Where else can you get insights into the inner workings of Walmart and Supervalu?  Not on Retail Wire, or PG or SN or anywhere……proof that the people who read and interact with MNB are the real insiders.

    Thanks. We like to think so.

    And we’re a lot more fun...

    (BTW...are you going to FMI in Las Vegas in a couple of weeks? Shoot me an email if you are...maybe we can find a way to rendezvous at some point during the show...)

    Yesterday’s MNB Radio was about the growth of texting, and why retailers need to embrace this technology as a way of interacting with customers ... even if some folks think it is the end of civilization as we know it.

    MNB user Dan Jones wrote:

    People forget how obnoxious the advent of cell phone usage was.  People speaking so loud into a phone, repeating the same mundane message over and over, oblivious to people around them.  I heard ½ of lots of conversations I had no business hearing.

    Texting is private, quiet, and instant.   The end of western civilization?  Seems to me things are more polite than before.


    MNB user Kevin Stopher wrote:

    I'm not sure how many text alerts I would sign up for but I received my 6am text from Heavenly ski resort telling me they received 15 inches of fresh powder last night, just in time for the last weekend of skiing.

    Now I don't think I would ever sign up for an alert that the local mart just received a truckload of apples or the bread just came out of the oven fresh but I would definitely sign up for an alert that a once a year beer was just received (like Pliny the Younger) at the local brewhouse.

    Clearly there are opportunities for texting your customers that can build relationships and increase sales. I don't have to tell you where I will be this weekend...

    It is all about permission marketing. People will sign up for text messaging that connects to their priorities. That’s called an opportunity.

    MNB user Philip Herr wrote:

    Not sure I agree with your imprecation that if retailers don’t connect with shoppers via this technology they will miss out or potentially lose customers. I’m not sure. Do consumers/shoppers enjoy having marketers insinuating themselves into all conversations? Any conversations?  Like social networks, the level of communication is intimate and in some cases private. And in those circumstances I believe that any intrusion by marketers is not only unwelcome, but potentially likely to have a negative effect and drive them off.

    I repeat:

    It is all about permission marketing. You are not intruding if you have been invited to do so.

    Another MNB user chimed in:

    Each quarter, Akamai publishes a “State of the Internet” report tracking attack traffic, connection speeds, Internet penetration and broadband adoption, as well as trends seen in this data over time. Since key findings in this quarterly report shows a large increase in mobile traffic, here are a few eye-opening stats on how often we check our crackberrys:

    • 95% of all text messages are read within 15 minutes.
    • Twice as many people use text messaging as opposed to email.
    • 17% of all text messages are forwarded virally.
    • 20% of people respond to a mass text message.
    • 1/3 of the entire world’s population have mobile Internet access.
    • 1.8 billion people will send a text message today.

    MNB user Ken Wagar wrote:

    I may well be missing something here regarding texting. At 60 years old I admit I am not in the mainstream of this phenomenon.

    It seems to me that texting is primarily a communication vehicle that allows two or more people to communicate without the need for either to be at a specific location such as at a landline telephone and without the need for all of the people to be free for a direct conversation at the same time. Pretty neat technology and obviously extensively used particularly by young people.

    It also seems reasonable that merchants should stay abreast of developing technology and communications tools to determine how they may best be used to improve their business.

    But having said that, I can’t help but wonder about the real utility of marketing by text message. Most of those my age grew up with the landline telephone as our primary non face to face communication device and although we may have used it extensively we rebelled strongly with regard to solicitation calls to our homes to the point of no call registries.

    Is it reasonable to think that young people texting at the rate of 1000s of texts per week and or month have any interest in receiving unsolicited text messages from companies trying to sell them something?

    Cell phone apps make all of the sense in the world to me where people can opt in or opt out of applications of all kinds including shopping etc but I am not so sure about texting. At the very least I think that unsolicited marketing texts could readily backfire on companies rather than enhance their business opportunities.
    What am I missing here?

    If marketers use texting to send spam, they will kill it. No question.

    But one more time...if they get permission from consumers to text them with relevant and appropriate ads, then they can hit home runs.
    KC's View:

    Published on: April 23, 2010

    There are few things finer in life than an afternoon baseball game.

    That’s what Michael Sansolo and I did yesterday - played a little hooky down in Washington, DC, and saw the Washington Nationals take on the Colorado Rockies in a crisp pitchers duel that lasted just over 2.5 hours. The Rockies won 2-0, but that wasn’t the point - the air was warm, the sky was blue and the beer was cold. All was right with the world.

    I won’t say that Nationals Park is one of my favorite stadiums. It is expansive, but lacks some of the character and charm of my favorite new ballparks, like Camden Yards in Baltimore, Safeco in Seattle, AT&T Park in San Francisco and Petco Park in San Diego. And, needless to say, it doesn’t have the history of Boston and Chicago shrines like Fenway Park and Wrigley Field. But there are good sight lines, roomy seats, and a nearby Metro station that gets you where you want to go. And the beer was cold.

    Another advantage - they have Ben’s Chili Bowl stands at Nationals Park, serving what they call “half smokes” - enormous and spicy sausages served with raw onions, cheese and chili. They went down easy...especially because the beer was cold.

    Summertime, and the living is easy.

    A company called B-Cycle is launching a bicycle rental service in Denver, with eyes to rolling it out to other major metropolitan areas around the US. Modeled on successful systems being used in places like Paris and Barcelona, B-Cycle allows you to set up a membership for anything ranging from 24 hours to 12 months and receive a swipe card (like Zipcar’s) that permits you to unlock a bicycle at strategically located stations.The bikes are by Trek, come with GPS, and even allow you to create an account page that tracks your miles, times, carbon offset and even how many calories you’ve burned.

    The lesson is a good one. In today’s climate, it isn’t just enough to rent a bike. Rather, it is critical to create a broader based service that provides all sorts of relevant information.

    I have a Zipcar account that I use whenever I’m in a city and need a short-term car rental, and I can easily imagine getting a B-Cycle account once the service begins to roll out. It’s all about options.

    I’ve become a fan recently of Evol frozen burritos, which come in a variety of favors and that I keep stocked in my freezer as emergency food. Not sure if you’ve ever had one, but they are worth checking out - my favorites are the breakfast and chicken, bean and rice varieties. So delicious that you won’t even think of them as frozen food. And may not wait for an emergency to eat one.

    Here’s what I don’t get about the almost 30 percent of the country’s households that have not yet returned their US Census forms.

    D’ya think these households will be the first ones to whine and say they are not being properly represented in Washington, DC?

    I don’t even like “South Park” very much, but as of now I am a fan of creators Trey Parker and Matt Stone, who have prompted the ire of a group called Revolution Muslim, which objected to the way in which the Prophet Muhammad was portrayed in a recent episode.

    “We have to warn Matt and Trey that what they are doing is stupid, and they will probably wind up like Theo van Gogh for airing this show. This is not a threat, but a warning of the reality of what will likely happen to them,” the group said in a blog post.

    Theo van Gogh is the Dutch filmmaker murdered by an Islamic militant six years ago.

    Sounds pretty much like a threat to me.

    This isn’t to say that Parker and Stone aren’t offensive. They are. Often. But they are equal opportunity offenders, best I can tell, with little regard for any cultural, governmental or religious institution. But if you don’t like ‘em, don’t watch ‘em.

    Jon Stewart’s response to Revolution Muslim last night seems pretty on target to me.

    Speaking of Jon Stewart....the best news this week was that the host of “The Daily Show” and Stephen Colbert have extended their contracts on Comedy Central through the 2012 elections. In a sea of insanity, Stewart and Colbert provide an island of humor, irreverence and even canny analysis.

    While I was anxious to see it, I actually was surprised by how much I liked Roman Polanski’s new film, The Ghost Writer.

    (We spent some time debating whether or not we ought to be spending any money on a Polanski film, with Mrs. Content Guy highly resistant. I’m no fan of Polanski’s personal behavior, but his Chinatown is one of my favorite movies, and The Ghost Writer had gotten solid reviews. We’d skipped the new Mel Gibson movie because she was appalled by his antics and anti-Semitism, so I was able to persuade her to give in on this one. But to be sure, one has to separate the man from the artist. The man is a sleaze. The artist is quite something.)

    The Ghost Writer is a classical thriller in the Hitchcock tradition, focusing on a ghost writer (Ewan McGregor) hired to help a former British prime minister (Pierce Brosnan) complete his memoirs. The job is complicated by the fact that Brosnan’s character is being charged with war crimes because of actions he took in concert with the US during the Iraq war; as the ghost writer probes the man and his motives, it is as if he is peeling an onion or assembling a puzzle slowly before our eyes. The movie is cool and steady, with terrific performances by McGregor and Brosnan, and a wounded and mysterious turn by Olivia Williams as the prime minister’s wife. There are also sharp portraits in smaller roles by actors such as Kim Catrall, Timothy Hutton, James Belushi (amazing but true), Tom Wilkinson and Eli Wallach, who at 85 knows how to make the screen sizzle.

    The Ghost Writer, based on the novel by Robert Harris, is well worth your time.

    My wine of the week is the 2009 Mar de Vinas Albarino, a crisp white from Spain’s Galicia region. This wine is delicious when served cold, especially with a spicy seafood dish. It is one of my favorites, and I cannot recommend it enough.

    That’s it for this week. Have a great weekend, and I’ll see you Monday.

    KC's View: