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    Published on: December 1, 2010

    The New York Times reports this morning that the US Senate has passed by a vote of 73-25 the Food Safety Modernization Act, described as “a sweeping overhaul of the nation’s food safety system on Tuesday, after tainted eggs, peanut butter and spinach sickened thousands of people in the last few years and led major food makers to join consumer advocates in demanding stronger government oversight.”

    The Act includes an amendment written by Sen. Jon Tester (D-Montana), which exempted food producers with less than $500,000 in annual sales or who sell the products within a 275-mile radius of where they are produced.

    However, there remains at least a possibility that the Act could not become law. The Senate version of the bill has to be reconciled with a version passed by the House of Representatives last year, and there is relatively little time in which to do so before the current Congress adjourns for the final time. There are reports that some Democrats in the House want to simply pass the Senate version and get the Act quickly to President Obama’s desk for his signature, but nothing has happened on that front yet.

    As the Times writes, “Both versions of the bill would grant the F.D.A. new powers to recall tainted foods, increase inspections, demand accountability from food companies and oversee farming. But neither would consolidate overlapping functions at the Department of Agriculture and nearly a dozen other federal agencies that oversee various aspects of food safety, leaving coordination among the agencies a continuing challenge.

    “While food safety advocates and many industry groups prefer the House version because it includes more money for inspections and fewer exceptions from the rules it sets out, most said the Senate bill was far better than nothing ... Health advocates are hoping the legislation will rekindle the progress — now stalled — that the nation once enjoyed in reducing the tens of millions of food-contamination illnesses and thousands of deaths estimated to occur each year. In the case of toxic salmonella, infections may be creeping up, according to government figures.”

    There was a chorus of approvals from various organizations.

    “Today’s passage of S. 510, the Food Safety Modernization Act, represents more than two years of thoughtful, bipartisan efforts that included industry, consumer groups and all other stakeholders working toward a shared goal of improving our nation’s food safety system,” said Leslie Sarasin, president/CEO of the Food Marketing Institute (FMI). “With today’s Senate vote, we have taken another important step toward modernizing America’s food safety network and focusing on preventing problems before they occur, rather than just reacting to them.”

    “The food and beverage industry is committed to partnering with Congress, the Administration and the FDA to strengthen and modernize our nation’s food safety system,” said Pamela G. Bailey, president/CEO of the Grocery Manufacturers Association (GMA). “We urge the House of Representatives to swiftly follow suit so that the President can sign this important legislation as soon as possible.”

    “Senate passage of this critically needed legislation represents a major milestone for food safety reform and for greater consumer protection from food-borne illness," said Jean Halloran, Director of Food Policy Initiatives at Consumer Union. “We urge the House to act promptly to pass food safety through the Congress and on to the President.”

    But, the reactions were not unanimous in their approval.

    “We are disappointed that the Senate continues to ignore the egregious loopholes allowed in this legislation that will erode consumer confidence in our nation’s food safety system,” said Robert Guenther, United Fresh senior vice president of public policy, referring to the Tester amendment “Now, when going to a supermarket, restaurant, farmers market or roadside stand, consumers will be faced with the question of whether the fruits and vegetables offered for sale adhere to basic food safety standards or not.  Unfortunately, instead of adhering to a science- and risk-based approach that was consistently the foundation of the underlying bill, the Senate has chosen to include a provision that will exempt certain segments of the food industry based on the size of operation, geographic location and customer base.  This provision creates a gaping hole in the ability of consumers to trust the safety of all foods in the commercial marketplace.”
    KC's View:
    I was impressed the other day by an op-ed piece in the New York Times written by Michael Pollan, author of “Food Rules: An Eater’s Manual,” and Eric Schlosser, author of “Fast Food Nation” and a producer of the documentary “Food Inc.” They concluded that while the “legislation is by no means perfect,” it “promises to achieve several important food safety objectives, greatly benefiting consumers without harming small farmers or local food producers.”

    They went on: “You would think that such reasonable measures to protect the health and safety of the American people would have long since sailed through Congress. But after being passed by the House of Representatives more than a year ago with strong bipartisan support, the legislation has been stuck in the Senate. One sticking point was the fear among small farmers and producers that the new regulations would be too costly — and the counter-fear among consumer groups that allowing any exemptions for small-scale agriculture might threaten public health.

    “Those legitimate concerns have been addressed in an amendment, added by Senator Jon Tester of Montana, that recently was endorsed by a coalition of sustainable agriculture and consumer groups. But now that common sense has prevailed, the bill is under fierce attack from critics — egged on by Glenn Beck and various Tea Partyers, including some in the local food movement — who are playing fast and loose with the facts.

    “Senator Tom Coburn, Republican of Oklahoma, is the bill’s most influential opponent by far. On the floor of the Senate the week before last, he claimed that only 10 or 20 Americans a year die from a food-borne illness, that the government doesn’t need mandatory recall power because ‘not once in our history have we had to force anyone to do a recall,’ and that the annual cost of the new food safety requirements — about $300 million — is prohibitively expensive.

    “Senator Coburn is wrong on every point. According to the Centers for Disease Control and Prevention, some 5,000 Americans annually die from a food-borne illness. Last year, at the height of a nationwide salmonella outbreak that sickened thousands, spread via tainted peanut butter, the Westco Fruit and Nuts company refused for weeks to recall potentially contaminated products, despite requests from the F.D.A.

    “And as for spending that extra $300 million every year, a recent study by Georgetown University found that the annual cost of food-borne illness in the United States is about $152 billion. In Senator Coburn’s home state, it’s about $1.8 billion. Compared with those amounts, this bill is a real bargain.”

    Published on: December 1, 2010

    by Kate McMahon

    It probably was inevitable that the iconic green bean casserole would be linked to the iPhone this holiday season, and that the venerable Butterball turkey experts would be rescuing dinners from disaster on Facebook.

    From light-hearted debates about “bag or tent” and “stuffing vs. dressing” to more serious salmonella-prevention strategies, Thanksgiving meals rocked the internet last week, and we can expect to see this continuing through the end of the year. Though seasonal, the trend points to consumer’s increasing demand for recipes, nutritional information and instantaneous feedback from their laptop or Smartphone.

    (Age-related disclosure: I learned to make Thanksgiving dinner by a) calling my mom on a rotary dial phone, and b) culling through her well-worn index cards in a recipe box or the “Joy of Cooking.”)

    A staple back then – and now – was the aforementioned green bean casserole, topped with French Fried onions.

    You have to hand it to the Campbell Soup Company for using social media to promote its very traditional brands – such as Cream of Mushroom soup (the central sauce for that casserole), Swanson broths and Pepperidge Farm stuffings.

    In addition to its print ads, the company now has online ads, iAds for the Apple iPhone, apps for smartphones, and interactive consumer promotions on Facebook and Twitter. The move into digital space is aimed at “trying to be where consumers are” and particularly to “engage younger consumers,” Campbell Soup exec Lisa Walker told the New York Times.

    Butterball, known for its Turkey Talk-Line telephone operators, also realized that the way to reach consumers/cooks is via their computers and PDAs. In fact, its Butterball Mobile link promises holiday cooking advice “no matter where you are — at home, on the road, in the grocery store, or at the stove.”

    While most of the exchanges on Butterball’s Facebook page ended up with happy customers, the company did advise the more troubling cases (improperly thawed, stuffed or half-cooked turkey) to call the 800-help line direct to discuss “food safety concerns.”

    Meanwhile, over on Reynolds Wrap’s Facebook page, Reynolds and Butterball teamed up for a “Bag or Tent” debate and sweepstakes (featuring Reynolds’ bag and foil, of course). As of yesterday, the bag method of roasting was leading the foil tent 51% to 48%.

    Not to be outdone, Swanson’s broth is hosting “The Great Stuffing Debate” on its website and has partnered with the Taste of the NFL campaign to promote awareness about hunger and raise funds for food banks across the country.

    Finally, not to be left on the sidelines is that other Thanksgiving staple, the cranberry, which staked its claim online through the Ocean Spray growers website and holiday hotline. It even twittered a link to Martha Stewart’s TV show featuring cranberries for decorating.

    While huge consumer product companies such as Campbell’s and Butterball have the digital media teams to launch these promotions, even the smallest retailer can take a page from their playbooks to engage with the customer well beyond the grocery aisle.


    Comments? Send me an email at kate@morningnewsbeat.com .
    KC's View:

    Published on: December 1, 2010

    It is being widely reported this morning that Google is preparing to make a $6 billion bid to acquire Groupon, the online coupon start-up that, as the New York Times describes it, “offers deeply discounted coupons from local stores, restaurants and services. Deal-hungry buyers often mobilize their friends and family through Facebook and Twitter, which helps the Groupon concept spread.”

    The bid includes $5.3 billion for the company, and $700 million in performance bonuses for top management. Groupon has been built on approximately $170 million in investment capital over the past two years. (If this deal goes through, it can be considered a fairly decent return on investment.)

    The Times writes that “the viral aspect of Groupon’s business could give Google a much-needed path toward social networking. Google has been frustrated in its attempts to create a social network and it fears the growing power of Facebook’s advertising machine, which produces higher ad responses because friends in the network recommend products and services.”

    And while some analysts believe the price is too high, others suggest that the price of not buying Groupon would be enormous ... because one of its competitors is almost certain to buy it, which will put Google at a competitive disadvantage.

    It is all very eye-opening, because deals and deliberations like these reflect how the marketplace is changing, and how relationships between marketers and consumers could change down the road.

    - Kevin Coupe
    KC's View:

    Published on: December 1, 2010

    The Wall Street Journal reports this morning that “early estimates indicated overall sales gains of about 20% from a year earlier for ‘Cyber Monday,’ the nickname for the Monday after Thanksgiving.

    “That comes on top of strong online sales growth on Thanksgiving Day and Black Friday. For those two days combined, comScore Inc. reported that online shoppers spent about $1.1 billion, up more than 15% from $913 million a year earlier.”

    According to the story, “Driving activity were Cyber Monday discounts of as much as 60% on sites such as Toysrus.com, as well as extensive free shipping offers ... Amazon's traffic on Black Friday went up 25%, according to comScore Inc. Target Corp. saw its Black Friday online traffic jump 9%, according to comScore, making it the third-most visited retail website, behind Amazon and Walmart.com.
    KC's View:

    Published on: December 1, 2010

    Bloomberg Business Week has a piece about Amazon Prime, the service that provides guaranteed two-day delivery of products for an annual fee of $79, in essence making delivery charges increasingly cheaper the more you order from Amazon.

    “Amazon Prime may be the most ingenious and effective customer loyalty program in all of e-commerce, if not retail in general,” the magazine writes. “It converts casual shoppers ... who gorge on the gratification of having purchases reliably appear two days after they order, into Amazon addicts.

    “Analysts describe Prime as one of the main factors driving Amazon's stock price - up 296 percent in the last two years - and the main reason Amazon's sales grew 30 percent during the recession while other retailers flailed. At the same time, Prime has proven exceedingly difficult for rivals to copy: It allows Amazon to exploit its wide selection, low prices, network of third-party merchants, and finely tuned distribution system, while also keying off that faintly irrational human need to maximize the benefits of a club you have already paid to join.”

    The story goes on: “The company declines to disclose specifics about the program, though analysts estimate it has more than 4 million members in the U.S., a small slice of Amazon's 121 million active buyers worldwide. Analysts say Prime members increase their purchases on the site by about 150 percent after they join and may be responsible for as much as 20 percent of Amazon's overall sales in the U.S.”

    “Now six years after the program's creation, rivals, both online and off, have sensed the increasing threat posed by Prime and are rushing to try to respond. Wal-Mart Stores, Best Buy, Target, and J.C. Penney have recently unveiled free shipping promotions for the holidays, turning the fall shopping season into a race to see who can go furthest in lowering shipping costs. In August, eBay announced its first rewards program, eBay Bucks, which gives shoppers 2 percent back on items purchased on the auction site using PayPal. Last month a consortium of more than 20 retailers, including Barnes & Noble, Sports Authority, and Toys 'R' Us, banded together with their own copycat $79, two-day shipping program, ShopRunner, which applies to products across their Web sites.”
    KC's View:
    As a dedicated Amazon Prime customer, I have to admit that I found the following paragraph from the Bloomberg Business Week story to be intriguing:

    Another debate among Amazon analysts and customers is whether Prime is actually worth the money. Many members swear by the service and evangelize about it ... Others question whether Prime is really a good deal, since Amazon usually offers free shipping when customers buy more than $25 worth of items at a single time. The company now reliably ships to certain parts of the country such as New York and San Francisco within a few days and at no extra charge.

    Have I been duped into spending $79 a year for the past six years for a service I really didn’t need? Could I be that gullible, that addicted to instant gratification?

    Maybe. But ultimately, I’m okay with that.

    There actually have been plenty of times over the past few years that I’ve ordered products for less than $25 - a book here, a DVD there (and even, back in ancient times, CDs) - and gotten them in two days ... or had them delivered to someone else in two days, which is good when one tends to be a last minute shopper for presents.

    The broader lesson here, and the one that other retailers need to learn regardless of whether they exist in the virtual or physical world, is how much Amazon knows about its customers, and how it converts that information into sales. I’ve always argued that more than anything else, Amazon is the most effective frequent shopper program ever invented, and Prime simply brings that to the next level. (So does Amazon’s Subscribe & Save initiative, which I’ve talked about here numerous times.)

    One other lesson - Amazon keeps raising the bar. Which is why it is no surprise that Bloomberg Business Week reports that Amazon is considering making one-day delivery its Prime incentive.

    Published on: December 1, 2010

    Supervalu-owned Albertsons announced that two of its Santa Barbara, California, stores have reached “zero waste” classification in their daily operations. What this means, according to the company, is that “through a combination of innovative recycling programs, a food donation program and a joint organic composting program with the City of Santa Barbara, the two stores now divert all non-contaminated waste from landfills and incinerators. In total, over 95% of all waste products from both stores are recycled, reused or composted – exceeding the 90% threshold commonly recognized as zero waste.”

    The company said that together, the stores divert annually on average 2,074,328 pounds of waste from the landfill, including 808,200 pounds of cardboard, 27,524 pounds of plastic and 2,688 pounds of paper.

    “Albertsons, and Supervalu as a whole, is committed to leading the way on environmental sustainability and diverting all possible waste from our Santa Barbara stores is a major accomplishment in this effort,” said Rick Crandall, Director of Sustainability at Albertsons, in a prepared statement. “In addition to keeping waste out of our landfills, we are charting a course for the future of our stores– one that will not only help our environment and the communities we serve, but also the overall success of our business.”
    KC's View:

    Published on: December 1, 2010

    The Washington Post reports that while there is some level of optimism about modest sales increases during the holiday shopping season, it may be tougher for small and independent retailers to see positive movement since so many big companies are spending a small fortune advertising various sales and promotions.

    The best response, various experts and analysts tell the Post, is for small retailers to a) sell products that the big guys don’t sell, b) offer services (from cooking classes to workshops) that the big guys don’t offer, and c) provide a more intimate and service-driven connection to the shopper’s needs and desires.
    KC's View:
    It never is easy, the Post notes, but it is only by doing these things that small retailers can give themselves any sort of differential advantage.

    This isn’t rocket science. But sometimes, it is important to be reminded of what the cost of doing business is these days.

    Published on: December 1, 2010

    Bloomberg reports that in an interview yesterday, Doug McMillon, Walmart’s chief of international operations, said that someday the company could have a CEO born outside the US.

    “A future CEO of Wal-Mart could be stocking shelves in India today,” said McMillon. “Wal-Mart is increasingly a global company.”
    KC's View:

    Published on: December 1, 2010

    Reuters Health reports that “rich in omega-3 fatty acids, fish is thought to rank high on the list of heart-healthy foods,” though there always have been concerns about the fact that “many fish species that wind up on the plate have high levels of mercury, a known neurotoxin.”

    Now comes a study out of Sweden arguing that the good outweighs the bad - that the protective qualities of food are far more significant than the potential exposure to mercury.

    However, some scientists dispute the findings, suggesting that the sample fish - from the Baltic Sea - may be different from fish caught elsewhere, and that the research simply is inconclusive.

    • Carrefour announced this week that it will launch two new banners in France - Carrefour Express, a convenience concept designed for urban markets and select rural areas, and Carrefour City Cafe, an urban format that will include a restaurant and a strong take-out foodservice component.
    KC's View:

    Published on: December 1, 2010

    Some reactions to yesterday’s piece about President Barack Obama welcoming two major American business leaders to the Oval Office,m and my comment that “if there is one thing that the Obama administration needs right now, it is great engagement with the business community. It’d be nice to see the White House draft people like Lafley and former Walmart CEO Lee Scott, bringing them into the fold and getting their constant input and management skills.”

    One MNB user wrote:

    Amazing, this Administration has always had access to great business people, but up to this point have never felt the need to talk with them or anyone else of substance. Interesting how getting your head handed to you in the election makes them moon-walk to the middle. I guess you could say better late than never, but in this case, I am not sure this is credible and nothing more than setting up for re-election in 2012. We were sold on transparency, which did not happen. We were sold on working together in a bi-partisan environment, which did not happen. We were sold on change, which did happen to the tune of the biggest deficit of all time. We are now to believe he wants to work with big business....hello, anyone in there?

    Increasingly, my approach is to adopt the Mel Brooks line as my mantra when it comes to all forms of government, regardless of the party: “Hope for the best, expect the worst.”

    The one thing I won’t do is assume that the people who agree with me have purer motives and are more patriotic than those who disagree with me.

    Another MNB user wrote:

    I think getting these two “available” executives taking some position in the Administration would be the best thing to get some confidence and get some people who know how to make things happen and re not afraid of getting bad news and overcoming it.  I think both are known for asking the hard questions and coaxing consensus without intimidating the participants.  All ideas are on the table.
     
    I think it was Lee Scott in an interview said that any problem is solvable…getting to 80% success is easy, it’s the last 20% that is the devil.





    Following up on yesterday’s email in which one MNB user wrote:

    Kevin, I am going to make a wild guess that most of your bricks and mortar retail experiences are not favorable for you, as neither are any of your experiences one-on-one with the masses...to put it gently...you probably come across in person as a bigger ass than you do sitting behind your computer screen blogging away.

    I responded that a judgement on whether I can be described in those terms is really up to other people, but I listed a number of brick-and-mortar stores that I love.

    MNB user Randy Aszman wrote:

    It never ceases to amaze me the comments folks will make on line that they would never say to your face. On line courage  I call it. I don’t agree with everything you comment on but you have never come across as an ass to me. But I will double check with your spouse.

    I was in Minneapolis last week looking at retail and walked into a Byerly’s. It had been a few years since I had been there and I was wowed all over again. What a store.


    And MNB user Katherine McClure wrote:

    I had to comment to your favorite email of the week.  My list of stores that I actually like to shop in mirrors yours and my husband and I joke about being “snobs” compared to most people.  It’s not that we actually think we are snobs, but we have standards for service that we are willing and fortunately able to pay a little extra for.  I’ll go to Publix and spend a few dollars more rather than Walmart.  No question.

    In my case, I attribute it to my first job in a full-service restaurant.  The training I received at Little Pappasito’s in Houston, TX made me realize that proper customer service makes all the difference in how people feel about spending money.  I had to pass tests on the entire menu before they would let me become a hostess! That raised my awareness for life.


    I’m with you on this. I worked my way through high school and college in a couple of different men’s clothing stores, and I learned much about customer service - and life - from a fellow named Richard Coulter, who owned a couple of stores in New Rochelle and Scarsdale, New York, called County Boys’ and Men’s Shop. I also worked at a men’s store in Marina del Rey, California, called the British Stock Exchange, where the owner, Tim Dyckman, taught me a lot.

    Ultimately, both jobs raised the bar for me on what I feel is an acceptable in-store shopping experience.
    KC's View: