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    Published on: January 18, 2011

    by Kevin Coupe

    Advertising Age reports that when Rupert Murdoch’s The Daily is launched in a few weeks as the nation’s first newspaper designed specifically for tablet computers like the iPad (which will have a period of exclusivity during the rollout), it will have sponsors that include Pepsi, Macy’s, Verizon Wireless and Virgin America.

    According to the story, The Daily is “one of the biggest bets on traditional journalism in years on any platform - 100 writers, editors and designers have been hired for the project - since Conde Nast sunk $100 million into Portfolio magazine.” When it launches, “The Daily will sell subscriptions through Apple's App Store: 99¢ a day after a two-week trial, according to people briefed on the project, plus the ability to push new content to the app throughout the day.”

    It is hard to know how The Daily will turn out, but it is certainly is worth paying attention to - it is a reflection of how the delivery of content is changing in some fundamental ways. I’m guessing that almost a buck a day will prove to be too expensive for most people, and that subscription rates will have to be established that will bring the e-paper into line with sub rates for the New York Times and Wall Street Journal. But I wouldn’t bet against Murdoch and The Daily ... and I’d certainly start trying to figure out how to gain access to the people who will be reading it.

    And that’s our Tuesday Eye-Opener.
    KC's View:

    Published on: January 18, 2011

    Advertising Age reports on a new study from Yahoo suggesting that of men aged 18-64, “more than half now identify themselves as the primary grocery shoppers in their households. Dads in particular are taking up the shopping cart, with about six in 10 identifying themselves as their household's decision maker on packaged goods, health, pet and clothing purchases.”

    In great part, this is because of the recession, which had more of an impact on men than women, putting them out of work and with greater domestic responsibilities. Of course, some of this may already have been taking place since women were occupying an ever-greater percentage of the workforce.

    Because the story is in Ad Age, it notes that “only 22% to 24% of men felt advertising in packaged goods, pet supplies or clothing speaks to them,” and concludes that marketers need to stop portraying men as buffoons or disinterested in the shopping experience, but rather should speak to them more directly ... or at least with some modicum of respect.
    KC's View:
    It has long been the argument here - even before there was a recession - that stores need to market to men more aggressively, that by doing so they can make the in-store environment more friendly and maybe even make more sales. (I say this as a male who has been doing 90 percent of the family grocery shopping for a quarter-century, and as the son of a man who did the vast majority of the shopping.)

    Published on: January 18, 2011

    The New York Times reports on a trend that food retailers have been aware of for years - that traditional format boundaries are breaking down, and that more stores than ever are selling food as a way of building traffic and sales.

    Here’s how the Times reports the story:

    “Reflecting a major shift in the way Americans shop for food, retailers better known for selling clothes or aspirin, including Walgreens, CVS/Pharmacy and Target, are expanding in a big way into the grocery business, with fresh produce, frozen meats and, yes, even sushi.

    “Target invested $500 million last year alone in a new push on groceries, retrofitting some of its general merchandise stores with full-blown food sections. Sales and traffic at stores with the new grocery areas are about 6 percent higher than at similar stores without them, the company says.

    “Walgreens began making over some stores in Chicago and New York a year ago, and added up to 500 food items. CVS/Pharmacy last year redesigned about 200 of its stores in urban areas like Boston, Detroit and New York, and expects to make over about 20 percent of its 7,100 stores in all.

    “As a result, people who typically went to the grocery store once a week to stock up are instead stopping by places whose food items used to be limited to a bag of chips or a can of soup. And retailers are viewing it as an opportunity to increase sales by getting people in their stores more frequently.”
    KC's View:
    What’s interesting about this story is the fact that with the exception of one quick mention - saying that Walmart generates around 30 percent of the US grocery business - the story doesn’t really address the fact that the Bentonville Behemoth really started this trend. Food retailers have known this for years, that nonfood retailers increasingly are using food to generate more sales and traffic. Traditional food retailers can use this as an advantage - while nonfood retailers use food to create traffic, people who know what they are talking about when it comes to food can use it to create magic.

    And there’s a real difference.

    Published on: January 18, 2011

    The New York Daily News reports that that a majority of small business owners in New York City - including 73 percent of grocers and convenience stores - object to Walmart being allowed to open for business within the five boroughs. The results of the poll contradict one released by Walmart late last year, which suggested that 62 percent of small businesses did not object to Walmart doing business in New York City.

    The story notes that an op-ed piece recently published in the News by Gristedes owner John Catsimatidis said that local businesses “invest 85% of the money they earn in the city while national chains invest only about 15% of their revenues locally. Also, many of these store owners are immigrants pursuing the American Dream, Catsimatidis wrote. Unavoidably, Walmart would have a tremendous anti-immigrant impact by putting many of them out of business.”
    KC's View:

    Published on: January 18, 2011

    The Wall Street Journal reports that Tesco plans to file a complaint with the UK Advertising Standards Authority, saying that an ad by Walmart-owned Asda Group promising to be 10 percent cheaper than its competitors is “‘confusing and misleading’ because it excludes around half of Tesco's range, and relies on a complicated process for customers to get their money back.”

    According to the story, “Asda responded with a statement commenting that ‘clearly the truth on pricing hurts. Our simple promise to be 10% cheaper or give customers the difference has gone down very well with customers since we launched it last week’.”

    The rhetoric is likely to continue because, as the Journal writes, “Asda's price guarantee kicked off the January price wars, which annually grips the grocery sector.”
    KC's View:

    Published on: January 18, 2011

    • The Washington Post reports that Walmart, which has stores in the Washington, DC, area and is planning to open four within the District, is “considering a job training partnership with the University of the District of Columbia's new community college to prepare city residents for jobs and combat concerns over its employment practices ... Wal-Mart began meeting with members of the D.C. Council in recent months to discuss ways the company could contribute to training for city residents. Such a partnership could advance another of the company's goals - stemming criticism from union groups and activists who say it does not fairly compensate employees and who are organizing to oppose the chain's plans.”

    • Shareholders in Massmart Holdings of South Africa have agreed to sell 51 percent of the company to Walmart, a move that gives the retailers its first foothold in the growing sub-Saharan African market.

    According to the story, “Massmart operates several wholesale and retail chains, including Game general-merchandise stores, Builders Warehouse for construction and Makro warehouse-club stores. The bulk of the company's 288 stores are in South Africa, although Massmart also operates in 13 other sub-Saharan countries.”

    However, the sales is not yet a done deal. According to the Wall Street Journal story, “the South African Commercial, Catering and Allied Workers Union, which held a press conference outside the venue where Massmart shareholders voted, said it will challenge the planned takeover through competition law and ‘in the political realm.’ It said it would also ‘directly educate’ its membership about the implications for workers, accusing Wal-Mart of being antiunion.”
    KC's View:

    Published on: January 18, 2011

    Starbucks announced that it will begin phasing in a new, larger cup size - the Trenta, a 31-ounce cup that only will be used for iced beverages. The Trenta reportedly was successfully tested in Phoenix, Tampa, and Atlanta, and will immediately be seen in 14 states - Virginia, North Carolina, South Carolina, Georgia, Florida, Alabama, Mississippi, Louisiana, Texas, Oklahoma, New Mexico, Hawaii, Nevada and Arizona - before completing its national rollout in early May.
    KC's View:
    If Starbucks is going to start selling 31 ounce drinks, it ought to be required to also install additional bathroom facilities. But maybe that’s just the opinion of a middle-aged man.

    But seriously...one piece that I read about the Trenta suggested that Starbucks was using it to be more competitive with McDonald’s. Which leads me to ask a brand equity question... Is this what Starbucks should be doing? I wonder how many people chose to go to McDonald’s instead of Starbucks because the drinks came in larger sizes; I’d guess not many, though I certainly could be wrong about that.

    The bigger question, in essence is this: At what point, by marketing against the competition, does one start paying more attention to their core value proposition instead of one’s own?

    Published on: January 18, 2011

    USA Today reports on a trend toward US retailers “installing charging stations for electric vehicles to serve owners of an emerging fleet of electric cars, bikes and scooters. Among the companies making installations and mentioned in the piece - Einstein Bros. Bagels, the Mall of America, Whole Foods, The Market (in Bellingham, Washington), Best Buy and Meijer.

    One likely change that is coming - in the past, most retailers have offered electric recharging for free ... but it is anticipated that many will begin to see it as a possible revenue source and start charging for electricity.

    • The Dallas Morning News reports that Albertsons LLC “plans to close seven unprofitable Texas stores next month, including five in the Dallas area, one of the most competitive in the nation. Liquidation sales start Wednesday, and the company expects the stores in Carrollton, Garland, Richardson , Plano and Southlake to close around Feb. 20.”

    The El Paso Times reports that ‘‘weeks after a ban on the thin plastic bags went into effect in Brownsville, El Paso, Austin and other Texas cities are talking about measures of = their own.” In El Paso, city officials reportedly will propose a fee for single-use plastic bags, hoping to cut down on litter. However, there remains some resistance to the idea on the part of some City Council members, and local retailers say that while they will comply with any ordinances, they believe that it has never been proven that a fee affects consumer behavior.

    At the same time, the Stamford Advocate reports that “Connecticut residents could be paying 5 cents for every plastic or paper bag they get when they go shopping, under a proposal from the Senate chairman of the state Legislature's Environment Committee ... Under the measure, the revenues produced by the 5-cent tax would go into a conservation fund overseen by the Department of Environmental Protection.”

    A similar measure was defeated by Connecticut lawmakers in 2009.

    • The Wall Street Journalreports that “MillerCoors LLC plans to launch a lemonade-flavored version of low-calorie beer MGD 64, the latest effort by a big U.S. brewer to rejuvenate slumping sales.” The new product reportedly will be introduced in May as a limited edition summer beer.
    KC's View:

    Published on: January 18, 2011

    • Walgreen announced that Graham W. Atkinson is joining the company as senior vice president and chief customer experience officer, responsible for developing and leading the company’s loyalty strategies. It is noteworthy - and indicative of Walgreen’s intentions - that Atkinson most recently was president of Mileage Plus for United Airlines, a customer loyalty programs with more than 50 million members.

    In other moves, Walgreen said that Sona Chawla, currently senior vice president of e-commerce, has been promoted to president of e-commerce; Mia Scholz, currently corporate vice president of accounting and controller, has been promoted to senior vice president of accounting and controller; and Robert Zimmerman, currently vice president of corporate development, is promoted to senior vice president and chief strategy officer.

    • Unified Grocers announced that Randy Scoville, who has been serving as the company’s Vice President and Chief Accounting Officer, has been named Senior Vice President of the company while retaining his CAO position.

    • Campbell Soup Co. announced that Ed Carolan, the senior vice president and general manager of baked snacks, Pepperidge Farm, has been named vice president and general manager of soup and simple meals. He succeeds Andrew Brennan, who has been named vice president, global strategy, advertising and design.

    Tim Hassett was named senior vice president, sales, Campbell North America; he previously was senior vice president - fresh and frozen bakery at Pepperidge Farm.

    Maureen Linder, the company’s vice president, global advertising and design, succeeds Hassett in that position.

    Darren Serrao, who has been serving as vice president and general manager of sauces and beverages, has been named to the new role of vice president and general manager, beverages and breakthrough innovation.

    • The Great Atlantic & Pacific Tea Co. (A&P) announced that Hans Meer, who has been running the company’s Food Emporium business, has left the company. No reason was given for his departure.

    According to the announcement, “To ensure effective leadership of The Food Emporium as the Company continues its comprehensive turnaround, Dan Wodzenski, District Manager of Sales and Operations for The Food Emporium, and The Food Emporium’s operations team will report directly to Paul Hertz, Executive Vice President of Operations, A&P, effective immediately. In addition, The Food Emporium Marketing & Merchandising Team will now report directly to Tom O’Boyle, Executive Vice President of A&P.”

    It has been speculated that A&P could sell the Food Emporium business as one way of putting its books in some sort of order, but no deal has been announced to this point.
    KC's View:

    Published on: January 18, 2011

    Susannah York, a significant British actress of the 1960s with credits in movies such as A Man For All Seasons, Tom Jones and They Shoot Horses, Don’t They, as well as an appearance as Kal-El’s mother in Superman: The Movie and Superman II, died over the weekend of cancer at age 72.
    KC's View:

    Published on: January 18, 2011

    ...will be posted on Wednesday this week.
    KC's View:

    Published on: January 18, 2011

    On Friday, we took note of how the folks who make Noxzema shaving cream may not have known that when they got as complaint on the phone the other day, the dissatisfied customer was none other than David Letterman. He told the story on “The Late Show” the other night. He’s been a 40-year user of Noxzema, but has found recently that the consistency had changed and that the cream would not stick to his face. He had one of his assistants call to complain.

    The folks at Alberto-Culver told the Chicago Sun Times that they offered him a coupon for a new can, a move they said was “standard procedure.”

    But Letterman said - on the air, to millions of viewers - that Noxzema said that it was having a nozzle problem.

    Here’s what I wrote:

    Here’s the real problem ... and it is only compounded by the fact that Letterman has a soapbox.

    You had a four decade user of the product with a complaint. Loyal users can be advocates for a brand, but unhappy customers almost always can wreck a company’s brand equity. Dismissing a complaint so cavalierly only serves to compound the complaint, not solve it. Resolving the complaint - and showing real compassion - serves to reinforce the strength of the brand.

    Furthermore, Letterman obviously was a loyal customer who cared enough about the brand to complain, as opposed to just switching to another brand.

    So pay attention next time the phone rings. It may be a grousing customer offering you a real opportunity to show how great a company you are, and how strong your brand is.


    One MNB user objected to the way I conflated the various versions of events with a breakdown in customer service:

    According to your story, Letterman was a loyal customer who cared enough to have a staff person complain.  Not make the call himself.  And you have his version of their response.  A second hand story, because he wasn’t the one making the call.

    Then you have the version from the company side, again, not first hand.

    One of the problems with having a platform is the credibility of the speaker, and sometimes things can be slanted for the effect of the moment.

    Not saying things didn’t go just as Letterman related they did, but how do you know for sure?

    Therein lies our dilemma, just because it’s on the web, on TV, on Radio... is it true?


    You’re missing the point.

    The essential facts of the case are not in dispute. Letterman had a staffer complain. The company offered a coupon. Letterman thought that the reaction was not appropriate, considering his four-decade loyalty to the brand.

    I think that having a staffer make the call actually makes the Noxzema reaction more typical than if Letterman had called himself.

    But here’s what even more important. Letterman has a soapbox, and used it. But every customer has a soapbox these days, on the internet ... and companies need to be more responsive, more sympathetic, more action-oriented when it comes to dealing with consumer complaints.

    Get used to it.

    MNB user Theresa Ruppert wrote:

    We always see examples of how companies are doing it wrong.  I wanted to share 2 examples of companies doing it right.  A big problem for online companies is consumers shopping on the site and leaving items in the shopping cart.  After looking for an item at Costco.com I put it in the shopping cart, but was not ready to buy it.  The next day I received an email from Costco reminding me of the item and noting that shopping carts are cleared every 48 hours.  The reminder sent me back to the site to complete the purchase.   What an awesome idea!

    The other example is from Amazon (big surprise there).  I had been looking for a specific type of book on the subject of yoga, but had not found the exact item I wanted.  During a visit today the site recommended 3 books that were often purchased together that fit my needs to a tee.  The result was a purchase for me and yet another win for Amazon.
     
    Final point is that I did share these good points with a colleague.  Noxzema messed up.


    MNB user Dave Thompson wrote:

    I could not agree more with today's article concerning the Letterman/Noxzema story.  Reminded me of an incident a few years ago.  I had an issue with the local Best Buy and spoke with the location manager.  Resolved the issue, then we began to talk about our common retail backgrounds, customer service and treating them as you would want to be treated.  He told me about a man who came into the store at least once a week, would peruse the store, but rarely bought anything, maybe a CD once in a while.  The gentleman was very modestly dressed, T-shirt, old blue jeans, ratty sneakers, not much to get in the way of making you think he would be a big spender.  His frequent visits to the store caused the manager to strike up conversations with him and a casual friendship formed.  Later on, during the holiday period, same gentleman comes in, dressed in custom made suit, strolls up to the manager and tells him he wants to buy 20 Playstation 3 systems as Christmas bonuses for his employees!  Retail on the system at the time was around $600.  Minimum $12,000 sale, all because the manager went out of his way to make that customer feel special.  Moral:  You never know who is on the phone, or who is standing there with you in the retail environment!




    I took yesterday off, noting that it was “a national holiday, a school holiday, and therefore a day on which Mrs. Content Guy and the sole remaining living-at-home Content Kid have the day off,” and that I had pledged to spend the day with them.

    One MNB user wrote:

    MLK Day is not a national holiday (I wish it was!), but rather a Federal holiday. How do I know this?  Because I'm at work instead of being home with my kids who, like federal employees, are off school today.

    Sorry I got the terminology wrong.

    I wish you’d had the day off, too, and I grant you that I’m probably luckier than most for being able to take the day off.

    I’m glad I did. Among other things, I got to go to the gym with my wife, have lunch with her, and hit the Apple Store with my daughter.

    Good day.
    KC's View:

    Published on: January 18, 2011

    The National Football League Divisional Playoffs took place over the weekend, with two major upsets as a pair of underdog teams (the Jets and the Packers) moved onto the Conference Playoffs.

    Baltimore Ravens 24
    Pittsburgh Steelers 31

    Green Bay Packers 48
    Atlanta Falcons 21

    Seattle Seahawks 24
    Chicago Bears 35

    New York Jets 28
    New England Patriots 21
    KC's View:
    Sorry, but I can’t help myself...

    J-E-T-S...Jets! Jets ! Jets!

    Published on: January 18, 2011

    Nielsen Online Basket View™, powered by MyWebGrocer’s aggregated e-commerce sales information, will provide regular insights on online supermarket shopping sales, including online shopping basket purchases. This will be the first time aggregate data will be available for online grocery shopping.

    U.S. CPG sales are expected to grow from $12 billion to $25 billion by 20141. Nielsen and MyWebGrocer research shows:
    • 25% of U.S. CPG purchases are researched online, including retailer weekly ads, searching for deals and recommendations from social sites.2
    • 97% of the time, the researched product is the product ultimately purchased, whether online or in-store.3
    • Online grocery shoppers are spending 2X as much on average at a retailer, compared to what an in-store only shopper spends.4
    • Understand the importance of online grocery for your brand. Contact us to find out more.

      1. Nielsen estimation 2. Nielsen survey, April/May 2011 3. Nielsen survey, April/May 2011 4. MWG Shopper Data, Q1 2011
    KC's View:

    Published on: January 18, 2011

    MyWebGrocer Faster Search!MyWebGrocer, the leader in driving online connections between grocery retailers and consumers, has announced the results of a year-long effort to boost the speed of searches running on its network. 50% of all ecommerce sessions across the MyWebGrocer platform use search functionality. Now, a search query result is returned 18 times faster on average. Faster search means satisfied, loyal shoppers.

    To find out how MyWebGrocer's can help you speed up your growth, visit MyWebGrocer.com or call 1-888-662-2284.

    KC's View: