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    Published on: July 29, 2010

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

    There was a good story in USA Today this week about Hyatt Hotels, which, it said, increasingly “is challenging hotel traditions as it looks to “reinvent the hotel stay.”

    In select locations, the company is doing away front front desks, giving away freebies such as minibar snacks, and even offering reduced housekeeping services as a way of both going green and reducing labor costs.

    This last one may seem a little odd, but when I was in Australia last month one of the hotels in which I was staying did precisely this - if I hung a card on the doorknob, housekeeping wouldn’t even come in. I didn’t need the sheets changed and the towels were plentiful...and so I opted not to have housekeeping services. It was fine for my needs and I felt environmentally pure about not getting fresh towels each day...though I must admit that it would have felt even better if they’d taken a few bucks off the bill for people opting not to use housekeeping.

    One of the other things that Hyatt is doing in its boutique Andaz chain of hotels is doing away with the concierge desk...and empowering groups of hosts to take care of such needs, or any other needs that guests might have. This plays right into the company’s overall hiring approach - the story notes that “Andaz emphasizes personality for all positions,” because every employee is considered to be “on” whenever and wherever they are at work. (Now there’s an approach worth emulating.)

    Now, I’ve mentioned this trend before, raving about the Aloft chain, which also has an unconventional approach to the hotel experience. But here’s the phrase worth noting - and remembering - from the USA Today story:

    Hyatt “is challenging hotel traditions as it looks to “reinvent the hotel stay.”

    That’s something we all should try to do - and not just once in a while or once a year or once in every year plan.

    But constantly and consistently, questioning the sacred cows of our businesses and seeing if we might be able to do things smarter, faster, more effectively...even if it means departing from tradition every once in a while.

    It keeps us from getting stale in the eyes of the consumer, and it keeps us from getting caught in a creative rut from which escape can be difficult.

    Beyond that, I think, it just makes work more fun.

    Anyway, that’s my Thursday morning “Eye-Opener” on MNB Radio. I’m Kevin Coupe.
    KC's View:

    Published on: July 29, 2010

    It is being reported that Theo Albrecht, who with his older brother Karl cofounded the Aldi discount supermarket chain, died last Saturday at age 88. No cause of death was provided by the notoriously secretive company.

    The two Albrecht brothers were German soldiers during World War II who after the war returned to their home town of Essen to run their parents’ grocery store. By 1950, they had expanded to more than a dozen units, and in the early 1960s launched Aldi, which stood for “Albrecht Discount,” focusing on a limited assortment of mostly private label brands. Today, the company has thousands of stores all over the world, with units in Germany, France, Spain and the United States, among other nations. Theo also owns Trader Joe’s in the US, which he acquired in 1979.

    Theo Albrecht has been something of a recluse for some four decades, after he was kidnapped in 1971. (He was released after 17 days, and the kidnappers reportedly were paid a $3 million ransom.)
    KC's View:

    Published on: July 29, 2010

    The Wall Street Journal this morning reports that convenience store chain Casey’s General Stores has rejected the sweetened bid for the company by Canada’s Alimentation Couche-Tard of $1.9 billion, and has launched its own recapitalization bid to buy back as much as $500 million worth of stock at a per-share price higher than that offered by its suitor.

    Couche-Tard’s offer is about $36.75 per share, while Casey’s offer is between $38 and $40.

    According to Casey’s president/CEO Robert Myers, the move was initiated because the board thinks that “"our stock is meaningfully undervalued at recent trading levels and that the company is under-leveraged given Casey's strong balance sheet and consistent cash flow."

    In a press release, Alain Bouchard, the Couche-Tard president/CEO, said he was disappointed with Casey’s rejection the company was disappointed with the rejection of the bid. "We will continue to evaluate our options," Bouchard said.

    As noted by the Wall Street Journal, Couche-Tard, which is the largest Canadian convenience store owner, wants to expand its U.S. presence with the acquisition. It has more than 5,800 stores, including a presence in 43 U.S. states, with its Couche-Tard, Mac's and Circle K brands. Casey's has about 1,500 stores located in the Midwest, mainly in small communities.”
    KC's View:
    I don’t have an appreciation for Canadian subtext. I’m not sure whether “we will continue to evaluate our options” means that Couche-Tard is willing to accept rejection, or if it means, “this is war, and you ain’t seen nothing yet, eh.”

    Published on: July 29, 2010

    Drug Store News reports that Wegmans is emphasizing the connection between food and health by putting “eat well, live well” stations near the pharmacies in its stores, where pharmacists can interact with shoppers on the connections that exist among food, medicine and lifestyle choices.

    “There’s so much good science showing that people lower their risk of many health problems when they make healthy food choices and include regular exercise in their routines,” says Brian Pompo, coordinator of wellness and clinical services for pharmacy at Wegmans. “As health professionals, pharmacists know that food and medication play different but mutually supportive roles in helping customers lead healthier lives. We do give customers the counsel they need and want regarding medications, but we also believe that sharing how food supports health helps customers.”

    Wegmans says that it regularly updates its pharmacists in informational sessions designed to give them the ammunition necessary to answer shopper questions.
    KC's View:
    Yet another reason, methinks, why many retailers would do well to wear a rubber bracelet on their wrists with the letters “WWWD,” for “What Would Wegmans Do?”

    Published on: July 29, 2010

    Media Post reports that the Federal Trade Commission (FTC) “is considering proposing a do-not-track mechanism that would allow consumers to easily opt out of all behavioral targeting, chairman Jon Leibowitz told lawmakers on Tuesday.

    Testifying at a hearing about online privacy, Leibowitz said the FTC is exploring the feasibility of a browser plug-in that would store users' targeting preferences. He added that either the FTC or a private group could run the system. Leibowitz said that while Web users on a no-tracking list would still receive online ads, those ads wouldn't be targeted based on sites that users had visited in the past ... Leibowitz also told lawmakers that he personally favored opt-in consent to behavioral targeting, or receiving ads based on sites visited. "I think opt-in generally protects consumers' privacy better than opt-out, under most circumstances," he said. "I don't think it undermines a company's ability to get the information it needs to advertise back to consumers."
    KC's View:
    I agree with him about the advantages of opt-in. Many consumers will be willing to provide personal information if they feel they are getting value back.

    The story notes, BTW, that “three years ago, a coalition of privacy groups including the World Privacy Forum, Center for Digital Democracy and Center for Democracy & Technology proposed that the FTC create a do-not-track registry, similar to the do-not-call registry. At the time, the online ad industry strongly opposed the idea of a government-run no-tracking list.”

    I’m a big fan of the do-not call list; it gave us our dinner hour back. And I think that a do-not-track registry also sounds like a very good idea.

    Published on: July 29, 2010

    Guiding Stars, the nutritional labeling program that assigns one, two or three stars to food products based on whether they are good, better, best for you, is launching a two-phased program this summer to offer an integrated nutrition guidance program for consumers in stores and online. Starting this summer, a new search engine, called the Guiding Stars “Food Finder” will be available on GuidingStars.com and will allow shoppers to search for any of the 60,000 foods in the Guiding Stars database and view the product’s star rating. Consumers can also engage in conversations, exchange ideas and share ratings at GuidingStars.com.  
     
    Later this year, consumers will be able to access a smart shopping function a meal planner and will be able to learn more about topics including healthier food choices, medical condition related alerts, shopping on a budget and weight loss.
    KC's View:
    The whole notion of nutrition labeling and transparency is going to become a lot more high profile; there was a Journal story the other day about how the NuVal system is influencing shopper behavior. (There also was the intriguing nugget that Walmart plans to unveil its own system later this summer...)

    In the end, you cannot legislate what and how much people eat. You can only treat them like adults, give them information and accessibility, and then hope that they make good decisions.

    Published on: July 29, 2010

    • The Chicago Tribune reports that the Chicago City Council voted 45-4 to allow Walmart to build its third store in the city, in the South Side neighborhood of Chatham. There has been some speculation that some aldermen might try to delay the vote so they could pressure Walmart on a number of fronts, but the issue “sailed through the council relatively easily.”
    KC's View:
    Walmart has promised dozens of stores for the Chicago market, in a variety of formats. And now, the flood begins...

    Published on: July 29, 2010

    • Rep. Bill Delahunt (D-Massachusetts) is scheduled today to hold a press conference with a bipartisan group of state lawmakers to push for passage of a bill that he introduced that would allow states to collect billions of dollars in sales taxes on internet purchases.

    “Without question, states and local municipalities are facing an unprecedented budget crisis,” said Delahunt (D-MA). “Instead of raising new taxes, this bill is a common sense approach that allows them to collect taxes that are already owed while coming to the aid of struggling small businesses in our communities.”

    “This bill is about fairness and competition.  It will help make sure that the store on the corner and the store on the Internet are playing by the same rules.  This will create fair competition that benefits consumers,” said South Dakota Governor Mike Rounds (R-SD). “Tax law should not favor out-of-state retailers over our own corner stores.”

    According to Delahunt’s analysis, “Sales tax revenues comprise up to a third of most state budgets.  This year, an estimated $18.6 billion will go uncollected; by 2012, the states will be losing at least $23 billion annually, based on conservative estimates.  From 2009-2012, this amounts to a loss of approximately $55 billion. In some cases, these revenue losses can comprise up to one half of a state's budget shortfall.

    “The legislation provides congressional authority for the states to have the ability to simplify and streamline their sales tax systems. To date, 24 states have entered into this interstate compact which contains a uniform set of guidelines. The bill does not compel any state to join, but those that choose to adopt this system would then have the authority to require online retailers to collect and remit sales taxes the same way that businesses on local Main Streets do now.”

    Delahunt says that the legislation is supported by the National Retail Federation, Retail Industry Leaders of America, International Council of Shopping Centers, Real Estate Investment Trusts Association, National Governors Association, U.S. Conference of Mayors, the National Conference of State Legislatures, National Association of Counties, and National League of Cities, “and over 50 state-level retail associations and chambers of commerce.”
    KC's View:
    I wanted to use this story this morning simply because it featured the word “bipartisan” in a way that did not make it sound like a four-letter word.

    I used to be conflicted about the sales tax issue, but the other day I noticed something on an Amazon invoice - there was sales tax included. I checked a bunch of other invoices, and saw the same thing. I’ve been paying sales tax to Amazon and didn’t even know it...and it didn’t affect my consumption patterns at all.

    The reason? Amazon offers a convenient and differentiated shopping experience that is highly customized to my needs and interests. The prices are sharp even with the sales taxes, but that’s not the ultimate reason I shop there.

    And so, it seems to me that there is no reason that other online marketers cannot do the same - depending on their own ability to innovate and serve shoppers for success, rather than on an artificial and probably unfair tax advantage.

    Published on: July 29, 2010

    The Wall Street Journal reports that PepsiCo is looking to revitalize its Quaker Oats brand, facing the fact that its momentum has stalled because of 1) competition from store brands, 2) competition from fast feeders, and 3) the sad truth that many people don’t eat breakfast.

    According to the story, “In response, PepsiCo says it is putting more money into Quaker's North America business, which accounts for nearly $2 billion a year in sales, about 4% of the food-and-beverage giant's total. Its goal is to get more people to eat a morning meal and to make it Quaker oatmeal, pitching the cereal as healthy, tasty and a good value.”

    Jaya Kumar, president of Quaker Foods & Snacks, tells the Journal, "The issue is to get category momentum. There is a far longer-term issue we have to deal with, which is to get Americans to eat breakfast, [and then] to make sure it's healthy.” Kumar says that only four in 10 Americans eat breakfast, even though 97 of people say that it is the most important meal of the day.

    The Journal writes, “As part of its push, PepsiCo, which concedes that it hasn't invested enough in product innovation at Quaker, plans to launch new oatmeal products for children and adults in coming months and develop new breakfast options at more affordable prices. To appeal to children, a key demographic that Mr. Kumar says the company hasn't sufficiently reached, PepsiCo plans to introduce a line called Quaker Mix-Up Creations, designed to let them combine different flavors into their oatmeal. Quaker says it is improving the texture of its instant oatmeal and reducing the salt and sugar. It also will introduce a new multigrain oatmeal aimed at adults.”
    KC's View:
    It isn’t addressed in the Journal story, but I’m sure that Quaker is working on some sort of social media component for this marketing push, especially important if it wants to talk to young people. The story does mention that the company’s best seller is “its cylindrical, 42-ounce box of raw oats with the trademark image of a vintage Quaker,” which may account for the young person problem.

    You’d also think that this would be an effort that Quaker could get retailers to rally around, to really do something different and aggressive - since breakfast is one of the meals that supermarkets should be capitalizing in terms of bringing back sales from the fast feeders. Just putting bananas near the cereal - or cereal nor the bananas - does not strike me as innovative marketing.

    Published on: July 29, 2010

    • The Austin Business Journal reports that Whole Foods “has trimmed more than a third of its Austin warehouse staff. The company said in a statement Wednesday that 59 of its 170 employees in its Southwest Distribution Center lost their jobs. The move is part of natural grocer's shift to primarily perishables in its distribution business.”

    MarketWatch this morning reports that “Trian Fund Management, through which activist investor Nelson Peltz has invested in food companies from Wendy's/Arby's Group Inc. to H. J. Heinz Co. and others such as Legg Mason,” has accumulated a 6.6 percent stake in Family Dollar Stores, saying that its shares are "undervalued in the market place and represent an attractive investment opportunity."

    According to the story, “Trian said the discounter has opportunities to improve its operating performance, such as increasing sales per square foot to levels of its peers and optimizing the number of new store openings. Further, the company could use its free cash flow to increase the size of its stock-repurchase program, according to Trian.”

    • Tyler, Texas-based Brookshire’s said that it is relaunching a frequent shopper promotion with a “Thanks A Million Collect & Win Game” beginning August 4 in 119 supermarkets in Texas, Louisiana and Arkansas.

    According to the company, “The game is a 15-week promotion in which customers receive a game piece with each transaction using their Thank You Card. Customers have two chances to win one million dollars. Customers place game markers on an official game board, and when they collect all the qualifying markers, they submit the game board to verify the prize. Customers can earn ‘bonus’ game pieces when they purchase selected products throughout the store with their Thank You Card. There is no limit on the number of bonus pieces customers can receive in a single transaction.”

    • Chase announced today it will open new full-service bank branches in 22 Albertsons stores in Southern and Central California this year. The first branches are now open in Kern, San Diego, Riverside, Orange and Los Angeles Counties as Chase expands to more than 800 branches in the state by year-end. Chase serves customers through 330 supermarket branches in Arizona, Colorado, Louisiana, Idaho, Illinois, Oregon, Texas and Washington.
    KC's View:

    Published on: July 29, 2010

    • The Grocery Manufacturers Association (GMA) announced the hiring of Leon Bruner, DVM, Ph.D., as GMA Senior Vice President for Scientific & Regulatory Affairs and Chief Science Officer.

    Dr. Bruner is a twenty-three year veteran of the consumer products industry.  He has served in a variety of positions at Procter & Gamble and The Gillette Company. Most recently, he served as Director, Environment, Health and Safety within Procter & Gamble’s Gillette organization.  He previously served as Vice President, Gillette Environment, Health and Safety from 2000 to 2007.
    KC's View:

    Published on: July 29, 2010

    We continue to get lots of email responding to some of the political discussions that have been taking place here the last few days...with the right sniping at the left, the left sniping at the right, and me sitting it in the middle saying that this is the reason government is dysfunctional. I wrote, in part:

    You illustrate my broader point.  You think he is an overly biased bully...and an idiot.  He thinks people like you are the same thing.  "Tell him to go to hell"?  There's no civility in the discussion, no room for any sort of compromise, no room to say that on some issues and approaches, the other guy may have a legitimate argument, even if you disagree with him.

    One MNB user thinks I am treading on dangerous territory:

    Here's some friendly advice regarding your political exchanges between readers, etc.: Stay away from politics, religion, and being too sure of yourself. Unless of course you're looking for one of those "talking head" jobs for the networks.

    I understand why you say that, and you’re hardly alone in feeling that way.

    But I have to tell you, some of the best and most interesting discussions we’ve had here on MNB have been about disparate subjects that include politics, religion, sex and baseball’s designated hitter rule. I think that this is because there is a level of passion applied to these subjects that sometimes is not seen in traditional business discussions...and I’ve never wanted to have just another business site. This means treading carefully sometimes, but I hope that with risk comes reward.

    And don’t forget - this whole thing started with a discussion of swipe fee reform.

    MNB user Craig Espelien wrote:

    It always amazes me the polarizing effects some things have on the political left and/or right.  As you are probably aware, I tend toward the conservative (at least fiscally and economically) and have lived in two places (Minnesota and California) where the left side of the equation is pretty strong.  I get very frustrated when political partisanship overrides common sense and reasoned debate.  I also am disappointed in the amount of “single issue” folks there are today.  Whatever happened to getting the issues out in the open so they can be discussed?  Whatever happened to “root cause analysis” rather than our current symptomatic bombast?

    I feel that your blog is pretty even handed – and it is always disappointing when you get blasted for trying to share a variety of views on a subject or any subject.  I view any sort of media like a restaurant – if you do not like what you see, you have the choice to opt out and try something else.  Keep it up – you and Michael provide a pretty good bit of broad business insight using movies and the retail trade as a base.


    Thanks.

    MNB user John Parvin wrote:
    Liked your summary today....
     
    Both left and Right sides are basically closed-minded and unable to see that together we accomplish more....and all of the name calling and anger just displays the lack of maturity on both sides.  Good for you for being willing to put it all on the table...something I admire and a large reason I tune in each day to your writings.

     
    I accused the two sides of “political malpractice,” which led one MNB user to write:

    Political malpractice, a perfect word for what our governance has become. We fail to KISS (keep it simple stupid) and over legislate. A simplified version dealing with interchange fee reform would have built a huge opportunity for the two parties to stand together and say "we did this to help you the consumer". This is something that all consumers and small businesses wanted, needed, and deserved. It would have been an excellent opportunity to build some dialog across the aisle and realize there is room for compromise on many issue that need to be address by this congress. I fear that tolerating this "Political Malpractice" will lead to even greater polarization of the congress and the populace. That is not good for a style of government that requires just those qualities.
     
    Another MNB user chimed in:

    Prepare yourself. I am not going to attack bleeding heart, liberal, profit haters. Nor am I going to attack heartless, conservative, wealth-mongers. Okay, not outside of those two inflammatory statements. I’m also not going to attack your pendulum leanings (right today, left tomorrow). All I pose is a bit of agreement with your perspective and a question.

    The more entrenched we become in our positions and the less willing we become to sharing and listening to ideas, the higher the likelihood for political impotence. Civility and Discourse are lost on the majority of us – nowhere in either of those is there a requirement to give up your values or wholeheartedly accept another’s. Civility and Discourse simply requires two the courage to do three things:

    1.       Honestly and openly share your ideas, beliefs and, most importantly, SOLUTIONS – with the goal of improving our situation
    2.       Humbly LISTEN to others and judge the solutions on their merits, not based solely on preconceived notions of bias based on party, race, creed or socioeconomic status.
    3.       Continue the conversation, ask questions, deliver feedback, identify common ground and drive for solutions.
     
    Instead we’ve all found it easier to spout our ideas (or those heard on either Hannity or Olbermann’s newsish programs) and then retrench ourselves. Rather than sitting down and discussing ideas, strategies and solutions for the better good and judging on the merits of each, we’re launching grenades and vitriol back and forth across a battlefield. That leads to becoming a combatant or disengaging from the process – I’m not sure either is helpful.

    By the way, my 8 yr. old niece reminded me something I find easy to forget. It’s no accident that Listen and Silent are comprised of only the same letters. We are free to share our take, but that freedom should come with the responsibility to shut our mouths when we’re finished and open our eyes and ears.


    MNB user Denis Zegar wrote:

    I don't want to beat a dead horse to death, BUT, the debate between the left and right is often misconstrued.  This can be easily remedied by simple semantics.  Washington Post, New York Times, Wall Street Journal, etc. are bona fide news organizations.  Fox News is an oxymoron.  By renaming Fox News to Fox Commentary, we would no longer have to worry about the facts just opinions.

    The same would have to be said of MSNBC, I think. Let’s be fair about it.

    MNB user Bernie Ellis wrote:

    Congratulations on your observations on the "right/left" debate. There is no debate, no compromise in today's political discussions. I am scared by the incivility and lack of facts that are bantered about today in almost all political "debates". The problems that face this country will not be resolved until we can talk seriously and without rancor with each other. Both sides are playing to their respective audiences and not trying to solve the issues.

    We face the serious challenges both economically and socially that every society faces as its population ages and changes ethnically. Too many people are fearful of what may become of their place in the pecking order.They are worried about it but do nothing to help lift the tide so everyone can gain. If we fight amongst ourselves, we will all fail.

    There are hard decisions to be made to because clearly our current path is not sustainable. The discussion shouldn't be about cutting taxes. The real question is what services do we want as a society and then how do we pay for what we want. What is our obligation to our children's children? Americans are too into today and lack the vision to see the tomorrow we should build for our children. How will they look at our behavior today in 50 years? Will they be proud of us and what we did to each other and the world?

    Today, I'm scared by what I hear on television on the subjects of politics, immigration and society.My parents were the children of immigrants and tasted hated and discrimination. As a result my father tolerated no words that defiled another human being. We need to return to that attitude.


    MNB user Frederic Arnal wrote:

    Your response to the angry political rants was exactly on point.  What on earth has happened to civility and discourse in this country?  I'm beginning to think that there are only two types of people; those who are willing to accept the possibility of different world views and those who aren't.  Neither is exclusive to the Left or the Right.  Not very encouraging.

    Responding to an angry rant from someone on the right, MNB user Gary Harris wrote:

    Wow, it’s that kind of stuff that makes me embarrassed to be a Republican. I may have to tear up the card. I long for the days when Republicans and Conservatives stood for something besides the downfall of the Liberals and Democrats.

    If success in the current system is based on the other guy losing instead of working with the other guy to actually solve problems and make the world a better place, we’re screwed. And I’m an optimistic person. I suppose my increasing intolerance for intolerance is making me part of the problem instead of the solution, but I’m hoping for a fresh breath of cooperation and accomplishment someday. Hope I’m around to see it.


    Me, too.
    KC's View: