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    Published on: November 4, 2010

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

    Here is the story put out via CNBC and a number of other media outlets this week:

    ANN ARBOR, Mich. - Borders Group Inc. is rolling out a new program that will have the bookseller matching prices if shoppers find in-store items selling for less at a local rival.

    The move comes as Borders tries to ward off increasing competition from online competitors and discounters as it heads into the holiday season. The action may drive cost-conscious shoppers into Borders stores, as the uncertain economy has kept most consumers focused on price as they hunt for holiday gifts.

    "In a competitive environment, the differentiators for consumers are value offerings combined with an exceptional in-store experience," CEO Mike Edwards said in a statement.

    Borders is also hoping shoppers will be drawn to its in-stock promise, a program that ships items to customer's homes for free if they are unable to find the books they're looking for in a Borders store or on its website.


    This all is well and good. It makes sense for Borders, which has had more than its share of troubles in recent years, to do everything it can to compete aggressively in the marketplace...though, to be fair, there’s nothing in this story that makes me go, “Yikes, I gotta to my Christmas shopping at Borders this year!”

    There is one line - actually two words - that I would take issue with...that in fact draw a big red circle around Borders’ problems, and the problems facing a lot of retailers in the current environment.

    “Local rival.”

    Now, I know what they’re getting at here, but I think in a lot of ways the notion of a local rival is kind of a 20th century construct. And not even late 20th century.

    There have been tons of stories on MNB and elsewhere lately about how, for example, Amazon has a smart phone app that allows you to take a picture of a product bar code, find out how much Amazon is selling that item for, and then order it with one-click. Or how Walmart will allow you to order anything from its website and have it delivered for pickup at your local FedEx Office store for no extra charge. Or how you can use an Android phone to take a picture of a bar code and instantly find out much everybody in a given area is selling them same item for.

    The list of applications - and the ways in which they position a wide variety of companies in an enormous number of places to compete with almost everyone - is only growing. Daily. Hourly.

    Sure, whatever you are selling, you are competing with the folks across the street or down the block. But the stark reality is that all competition is local, because local doesn’t mean what it used to mean.

    You have to be aware. You have to be engaged. you have to be competitive.

    It can be a little scary. But here’s the good news. Do it right, do it aggressively, and suddenly you can successfully compete with retailers that aren’t anywhere near you for their customers.

    It ain’t pretty, and it ain’t for the faint of heart.

    But it is reality.

    For MNB Radio, I’m Kevin Coupe.
    KC's View:

    Published on: November 4, 2010

    Bloomberg Business Week reports that “Casey's General Stores says it has dismissed a $43 per-share takeover bid from 7-Eleven Inc. and ended negotiations with the convenience store operator.” According to various new reports, Casey’s said that the bid does not reflect the true value of the company; 7-Eleven had raised its bid from $40 per share.

    Casey’s recently rejected a $38.50 per share bid from Alimentation Couche-Tard, and had treated the Canadian company as a hostile suitor; 7-Eleven had been treated more sympathetically, but not so much so that Casey’s was going to give it a break on price.

    “While we are no longer in talks with Casey's regarding a transaction, our strategy is to grow aggressively in the U.S. and Canada. We will continue to pursue transactions that make sense for our company to maximize shareholder value," said Joe DePinto, 7-Eleven's president and CEO. "Expanding our store base enables us to further leverage our merchandising expertise, proprietary distribution network and scale in order to provide more convenience to our customers."

    Casey’s may not be sold, but that doesn’t mean it isn’t buying - the company also announced this week that it is acquiring 44 Kabredlo's convenience stores - in Nebraska, Kansas and Oklahoma - and will convert them to the Casey’s banner.
    KC's View:
    Seems pretty clear to me that the Casey’s folks had no intention of being acquired, and probably weren’t even negotiating in good faith. They just had to play the game, but do what was necessary to maintain a level of autonomy.

    Published on: November 4, 2010

    Bloomberg reports that Starbucks has made an interesting decision, planning to spend the budgeted $250 million on store renovations in the US, but only upgrading half the 1,900 stores that originally were scheduled for a 2011 facelift.

    According to the story, the company will be “emphasizing stores in precincts like Manhattan’s Soho district, and employing such eco-friendly touches as reclaimed furniture,” hoping that paying greater attention to certain units will “lift the whole brand.” The new decor package costs more than the old one, and so the company had to make a decision - either cut the number of stores scheduled for renovation, or double its budget, which would hurt the company’s financial performance.

    Critics of the strategy suggest that Starbucks risks alienating customers who get annoyed at aging stores, at the same time as McDonald’s continues to invest in its coffee program.
    KC's View:
    At this point in time, after several years of less than inspiring performances, there is no way Starbucks is going to do anything that will hurt the numbers. This choice may be something of a gamble, depending on the actual shape of the stores due to be renovated.

    I think long term, as well as the stores are clean, the employees are friendly, the products are tasty and fresh, the free wi-fi is working, and the rest rooms are spotless, the color and texture of the wood tables are less important. Drop the ball on any of that stuff, on the other hand, and the whole brand ages. Badly.

    Published on: November 4, 2010

    The Los Angeles Times reports that Target Corp. plans to open a store in downtown LA, though the store will be “smaller than most and carry a different merchandise mix, with a heavy emphasis on food and household basics,” which is reflective of the “new direction for the Minneapolis-based discounter to bring smaller stores to more dense metropolitan markets.”

    It is also part of a broader effort to change the face of downtown LA, making it a more livable and thriving community that serves as a magnet for residents interested in an urban lifestyle.
    KC's View:
    One can only imagine Target executives singing...

    Rollin’ down Imperial Highway,
    Big nasty redhead by my side
    Santa Ana winds blowin’ hot from the north
    And we were born to ride...

    Roll down the windows, put down the top
    Crank up the Beach Boys, baby
    Don’t let the music stop
    We’re gonna ride it will we just can’t ride it no more.


    (Still, by the way, one of the great songs...)

    Published on: November 4, 2010

    • Walmart reportedly is interested in acquiring Indonesian retailer Matahari’s hypermarket business, according to a Reuters story.

    Reuters writes that “Wal-Mart is expected to compete in the auction with South Korea's Lotte Shopping and private equity fund Carlyle Group. Although it was unclear whether Wal-Mart had submitted a formal offer, sources said the retailer has hired Barclays Capital to advise it on the transaction.”
    KC's View:

    Published on: November 4, 2010

    Time reports that both the National Oceanic and Atmospheric Administration (NOAA) and the US Food and Drug Administration (FDA) have said that “96% of relevant Gulf of Mexico waters became available for commercial and recreational fishing — up from 37% during the worst of the Gulf oil spill.”

    "The overwhelming majority of the seafood tested shows no detectable residue, and not one of the samples shows a residue level that would be harmful for humans," Margaret A. Hamburg, commissioner of the Food and Drug Administration, said in a statement. "There is no question Gulf seafood coming to market is safe from oil or dispersant residue."
    KC's View:

    Published on: November 4, 2010

    US News & World Report has a story about how retailers are getting out in front of the traditional Black Friday beginning of the holiday shopping season, leaking details of sales and promotions to news outlets and websites that are more than happy to get out the word.

    Some of the leaks are exactly that - unauthorized, sometimes inaccurate, and giving the competition a heads up on the deals that will be offered. But at a time when consumers are expected to be looking hard for sharp discounts, there also is a feeling that getting out advance word is one way of differentiating oneself from the competition.
    KC's View:

    Published on: November 4, 2010

    • Kroger and the United Food and Commercial Workers (UFCW) reportedly have reached an agreement that covers close to 12,000 employees in the Cincinnati area. A ratification vote is expected to take place today.

    • Wegmans announced this week the introduction of a private brand blood glucose monitoring systems, described as “a basic tool in self-care for people with diabetes.”

    The retailer said that its “ TRUEresult system and TRUE2go – small enough to fit a purse, pocket or gym bag - can help those with diabetes and pre-diabetes track blood glucose levels more easily and at a lower cost than with other comparable systems on the market today ... Because the machine automatically calibrates itself to each test strip, you don’t have to enter a test strip code – eliminating a common source of error. You just stick a testing strip into the machine, prick your finger with the lancet to collect a drop of blood, and touch the finger to the testing strip. The strip absorbs the blood and activates the machine. A large-display readout appears in just 4 seconds. The machine has four testing reminder alarms, a 500-test memory to see trends over time, and alerts the user to test for ketones if blood glucose levels are high.”

    • The Associated Press reports that the US Food and Drug Administration (FDA) said that listeria bacteria has been discovered at a Texas food processing plant, the SanGar Produce & Processing Co. plant in San Antonio. The plant was closed on October 20.

    The listeria in contaminated celery has been linked to four deaths.

    • The St. Louis Post Dispatch reports that “union workers at St. Louis' three largest grocery chains approved a new three-year contract late Tuesday night that offers a 50-cent hourly raise and increases employee health insurance premiums.”

    The agreement covers more than 9,000 workers employed by Schnuck Markets, Dierbergs Markets and Shop 'n Save stores.

    The new contract will run through May 2013.
    KC's View:

    Published on: November 4, 2010

    • The Hershey Co. announced that it has named J.P. Bilbrey, current president of Hershey North America, to be its COO, a new position.

    The company said that the move allows CEO Dave West to pay greater attention to strategic and business development issues.

    According to the announcement, “Bilbrey will also lead two new business units, responsible for building and leveraging Hershey's global brands, creating confectionery marketplace innovation and disseminating best demonstrated practices.”
    KC's View:

    Published on: November 4, 2010

    In his “we got shellacked” post-election press conference yesterday, President Barack Obama handed 7-Eleven a golden marketing opportunity, suggesting that he might hold a "Slurpee Summit" with the new Republican leadership.

    The line played off criticism that Obama had offered during the recent campaign, saying that Republicans stood around drinking Slurpees while Democrats did the hard legislative work.

    USA Today reports that “White House officials were contacted late Wednesday by officials representing 7-Eleven with a proposal for the Slurpee brand to cater a Slurpee Summit between key Democrats and Republicans. The summit could be at the White House — or wherever the president chooses.”

    7-Eleven also will launch a new ad campaign emphasizing the proposal, positioning the Slurpee as a product that brings people together.
    KC's View:

    Published on: November 4, 2010

    I’ve gotten a lot of notes from MNB users over the past 24 hours, and I just wanted to say “thank you.” You folks have amazing memories, or just very effective calendar programs.

    I am touched.
    KC's View:

    Published on: November 4, 2010

    MNB took note yesterday of a Los Angeles Times report that the San Francisco Board of Supervisors has voted - by a veto-proof margin - to ban the sale of kids’ meals that contain a toy as well as exceeding certain levels of calories, sugar and fat. In essence, the ban covers the sale of McDonald’s Happy Meals as they currently are constituted.

    MNB user Dave Vosteen wrote:

    Once again California proves it needs to go away and float away. I would never live in that state for all the money in the world. They have taken the liberal agenda to a new extreme. Bunch of idiots with 14 % unemployment and one of the highest foreclosure rates but lets keep electing the same people and worry about happy meals. Insanity is doing the same thing over and over again and expecting different results. Bunch of liberal retards and you should have taken a stance against this infringement upon my freedoms. Shame on you for not saying they are all a bunch of lunatics.

    So much for civil political discourse.

    I have news for you.

    California may not want you, either. And that’s okay. You are certainly allowed to have a different opinion.

    I’m not sure how they’ve infringed on your freedoms. You don’t live in San Francisco, and I suspect there isn’t much chance of that happening. If you happen to visit ... and I recommend it, since San Francisco is one of the world’s great cities ... there are a lot of other options in terms of food.

    You also take a simplistic view of “California.” Is San Francisco liberal? Sure. But just recently, driving through some of the more agricultural parts of the state, I saw an enormous number of Tea Party signs. California certainly has problems, but it also is a place of great diversity, and many of its communities are among the most tolerant in the nation. If California were to “float away,” the nation would be less for it.

    “Liberal retards”? Shame on you.

    It is discourse like that that will wreck what Abraham Lincoln called the “last, best hope on earth.”

    From MNB user Alex Drew comes a more civilized form of criticism:

    For a city known to be free thinking and tolerance on personal choice they are sure making some laws that take that right away.  Kind of going to the other side of the extreme spectrum.  Maybe next they will ban red meat altogether. 

    You are free to have the right to choose for yourself, if only your choice matches ours.  Sounds like the new motto for many cities putting these bans in place. 


    Another MNB user wrote:

    Eliminating the toy is ridiculous.  Making the meal healthy with "kid appeal" is the issue.  I have not eaten at McDonald’s since my junior year in college, 1986, but the toy idea is a no brainer.  Who goes to dinner with a two, three or four year old without an entertainment plan?  McDonald’s had it covered.




    On another subject, MNB user Michael Bruce wrote:

    Wow, in your one rebuttal to the hoopla over Justin Bieber, you throw out Bobby Sherman’s name, and I’m guessing that only you, I and maybe a handful of your other readers know who that is.  But since you’re reaching so far back and dating some of us, do you remember the show he starred in?  I know you’re a movie guy, but let’s see how you are with old TV shows.

    Always read and enjoy your news topics and your views!  And just sometimes, you simply put a smile on my face on what otherwise would be another ho-hum day of keeping up on things!


    The show was “Here Come The Brides,” and it co-starred Robert Brown and David Soul (before “Starsky and Hutch”). And you can ask Sansolo ... I knew the answer to that without looking it up online.

    I’m actually pretty good with old TV shows.




    Regarding Fresh Market’s national expansion plans, one MNB user wrote:

    One major problem with Fresh markets going national…They can’t use the name in Utah. (Affiliated operates a chain there with that name that are the former Albertsons).  It would be interesting to see where else they can’t use the name.  Sunflower/Newflower ran into this after they sold the rights to the name to Supervalu a few  years ago (which for $20 they might be able to get back now considering SVU’s current issues).

    Another MNB user wrote:

    I love their stores (live in Florida) but I agree with you completely. The infrastructure will not handle it. They now stretch from Wisconsin to Florida and that "taxes" them now.




    Responding to my politically themed Eye-Opener yesterday, one MNB user wrote:

    I couldn’t agree with you more!! I am so feed up with gas bag politicians that I voted anti-incumbent, I didn’t care what party they belonged to. I am normally conservative, but if the GOP thinks they have a mandate and screw around with this next 2 years they will be out on their collective ass. We need results, not sound bites, and somebody needs to have the b---- to do the tough things to get this spending under control.

    I also made a couple of references to “Morning Joe” on MSNBC yesterday, which led one MNB user to write:

    How could you forget also on “Morning Joe,” Elvis Costello?

    He was great, wasn’t he? And his new album sounds wonderful.

    Though to be fair, he’s no Justin Bieber.
    KC's View: