retail news in context, analysis with attitude

MNB Archive Search

Please Note: Some MNB articles contain special formatting characters, and may cause your search to produce fewer results than expected.

    Published on: May 12, 2011

    by Michael Sansolo

    From the sidelines of Olympic basketball to the realities of supermarket aisles, the attendees at the Food Marketing Institute (FMI) Future Connect conference got a huge dose of leadership lessons Wednesday at the Dallas conference.

    The day kicked off with famed college basketball coach Mike Krzyzewski (that’s Sha-chef-ski or Coach K for the non-basketball fans) explaining the dynamics of coaching the US National team at the Olympics.  Coach K mixed colorful stories of superstar athletes with relevant leadership tactics, such as active listening to his players, incorporating player suggestions into team meetings and the value of broad goals and vision.

    Gary Chartrand, executive chairman and former CEO of Acosta followed up with a call to “unreasonable” leadership and the importance of dissatisfaction with the status quo to create breakthrough moments in leadership and business.  Chartrand explained how Acosta evolved from a regional broker into a North American-wide sales and marketing agent after realizing in the mid-1990s that the company was perfecting a business model whose time had passed.

    Author Daniel Pink concluded the day on the science of motivation, explaining the limitations of traditional incentives in a more complex workplace.  He explained how increased autonomy for workers, greater mastery and a sense of purpose are larger drivers of performance in the current economy than ever.
    Attendees spent the bulk of the day in breakout rooms, where speakers detailed key topics in management.  Some highlights in the strategic management room (where I was serving as moderator) were:

    • Managers need to learn to focus more carefully on listening attentively to associates to convey a sense of caring and teamwork.

    • Managers and associates can manage stress better by taking time to pause when feeling tension to avoid angry blow-ups that damage relations and employee morale.

    • Consistent and clear assessments are essential for good internal feedback and companies must stay heavily focused on building career paths for associates and finding ways to build succession plans.

    In other FMI news...

    FMI announced the Grand Prize winners of the 12th Annual Store Manager Awards today at Future Connect:

    • Shawn Commons, store manager at PriceRite Supermarket in Reading, PA. (Category A, companies with 1-49 stores.)

    • Allan Bussey, store director at the Brookshire Grocery Co. in Tyler, TX. (Category B, companies with 50-199 stores.)

    • Kristi Masterson, store director at Hy-Vee in Sioux Falls, SD. (Category C, companies with 200 or more stores.)

    “FMI celebrates these successful store managers for the leadership they demonstrate in their stores, for the contributions they make in their communities and the innovative ways they increase sales,” said FMI president/CEO Leslie G. Sarasin.  “We know the diligence it takes to generate sales growth and make a positive impact in this competitive marketplace and we salute all of them for their extraordinary work.”
    KC's View:

    Published on: May 12, 2011

    by Kevin Coupe

    Content Guy’s Note: Below is a commentary on the same subject as the video piece, but it isn’t word-for-word the same. You can look at both, or is up to you. I look forward to hearing from you.

    This month marks the 70th anniversary of the original release of Citizen Kane, Orson Welles’ landmark movie that often is referred to as the greatest movie ever made.

    Part of the reason that Citizen Kane remains both a classic and a cultural touchstone is that Welles was an audacious filmmaker - he believed in big ideas, big execution, big risks. In a lot of ways, he shared that with Charles Foster Kane. And like Kane, he spent much of his life trying to deliver - unsuccessfully - on the early promise. Kane dies an old and lonely and unfulfilled man, isolated in Xanadu, his palatial estate. When Welles died, he was a bloated caricature of himself, known more for appearing on the old Dean Martin show and doing commercials for cheap wine.

    There’s an old Woody Allen line that goes like this: “It is the fate of all great artists to have people say, “I prefer the early stuff.” There’s probably nobody that this line applies to more that Orson Welles.

    But there is a great business reason to watch Citizen Kane, which remains as timely today as it was seven decades ago.

    In a lot of ways, Citizen Kane is a movie about losing touch with the defining qualities that make people and businesses special, and about becoming disconnected from the customers who ultimately are responsible for our success. That’s a lesson that more executives and businesses need to pay attention to, because especially as we get bigger and more successful, there is a tendency to do things that are good for our operational imperatives, as opposed to doing things that are, first and foremost, good for the customer.

    Kane’s disconnection becomes absolutely clear when, about halfway through the movie, he’s been found to have been cheating on his wife, and is given the option of stopping his run for governor or being exposed in the newspapers. He chooses to stay in the race, saying that “the people” will follow him. But of course, by that point, he has no real sense of the people. And that’s the beginning of the end...

    That’s a real lesson for marketers. If they don’t know who their customers are, how they feel, what they think and what they are buying, then it may well be the beginning of the end.

    It is the timely lesson of Citizen Kane, which remains as relevant today as when it was released seven decades ago.

    That’s what is on my mind this Thursday morning. As always, I want to hear what is on your mind.
    KC's View:

    Published on: May 12, 2011

    USA Today writes that while the recession may be technically over, “food insecurity” continues to be a reality for many more people in this country, as “a growing number of ... once-thriving middle-class families didn't expect was to find themselves qualifying for - and needing - the support of federally funded food assistance programs.”

    Vicki Escarra, president/CEO of the hunger relief charity Feeding America, tells that “there is a growing problem with suburban poverty, ‘where new clients are individuals who have never needed to rely on the charitable food system’.”

    Here are the stats, according to the story:

    “A record number of 44 million or one in seven Americans (half of whom are children) are currently enrolled in the government's largest nutritional safety net program - the Supplemental Nutrition Assistance Program or SNAP, according to the USDA. Formerly known as the Food Stamp Program, SNAP is federally funded, but administered by states.

    “Additionally, government-affiliated food banks and other community and faith-based food pantries and soup kitchens served more than 37 million Americans, according to Feeding America's 2010 hunger study. This figure is up 46% from 2006.”
    KC's View:
    All of which explains the continuing growth and popularity of formats like Winco, Aldi, Save-A-Lot and other retailers that are focused on price. And makes it a little mystifying that Walmart, which used to own this space, has somehow parlayed the recession and a continuing recessionary attitude into seven consecutive quarters of stagnant US same-store sales.

    Increasingly, it seems to me, it will become increasingly difficult for stores that occupy the muddy middle, with few distinguishing characteristics and no real story to tell, to capture the attention of an economically (as well as socially and culturally) bifurcated American public.

    Published on: May 12, 2011

    Fox News reports that Publix Super Markets is changing its coupon acceptance policies to make them more consistent across the board in the different markets it serves.

    According to the story, the retailer will continue to allow “stacking,” or the ability to use both a manufacturer and store coupon for one item, and, for buy-one--get-one promotions, shoppers will allow the use of two coupons, one for the “buy one” item and one for the “free one.”

    However, Publix will now empower store managers to determine what stores constitute local competition, for the purposes on honoring competitor’s coupons; the story notes that “Walgreens and CVS coupons will no longer be allowed, unless they're used for the pharmacy.” And store managers will be allowed to limit purchases of sale items by any single person as a way of ensuring that there will be enough product for everybody.

    In addition, Publix says that it “will only accept coupons for identical merchandise we sell. Acceptance is subject to any restrictions on the coupon and we reserve the right to limit quantities ... Manager approval is needed for individual coupons above $5.”
    KC's View:

    Published on: May 12, 2011

    The St. Petersburg Times has a story about free self-service vision testing machines being tested next to the blood pressure testing machines in three Sweetbay Supermarkets, which it suggests is just the next step in kiosk marketing in the US. And this is just the beginning: “Many of the first 500 Solo Health Stations will appear in Tampa Bay grocery stores by year's end. This new multitasker will check blood pressure, measure body mass index, perform visual acuity exams and list prevention medical tips to those who key in their health profile.”

    According to the story, this is a natural evolution, given the increasing popularity of Redbox DVD rental machines and the established dominance of ATM’s in the banking industry, not to mention self-checkout in supermarkets, self check-in at airports

    "Self-service has become ubiquitous partly because people think it puts them in control," Lee Holman, an analyst with the IHL Consulting Group, tells the paper. "The only population segment that objects to it is working mothers with young kids. They regard cashier checkout as one of their few down times."

    The vision testing machines were developed by Solo Health, which the story says is “armed with a $1.2 million grant from the National Institutes of Health and backed financially by Coinstar, the owners of Redbox and self-serve change-counting machines, envisions a connected network of multi­tasking Solo Health Stations.

    “Stores will pay some rent. Health care product makers will pay for the kiosk to hand coupons to patients they know need their products. And insurance companies may pay and offer premium discounts to patients with chronic conditions that can be monitored on shopping trips.”
    KC's View:
    In Florida, however they provide information at those self-service kiosks, I hope the words and numbers are in really, really big print.

    This is the next evolution in health care, and I think that as long as people don’t actually use these machines to replace actual health care professionals - but instead use them to monitor their own conditions and get relevant, appropriate guidance - it is a good thing. After all, anything that gets people to take responsibility for their own health is a positive step.

    Published on: May 12, 2011

    In the UK, the Guardian reports that new Tesco CEO Philip Clarke has said that one of his goals is to create more "highly valued brands" that the company can add to its portfolio - such as the clothing label Florence & Fred (F&F) and the Technika consumer electronics brand - already sold in Tesco stores around the world.

    According to the story, “Clarke said shoppers did not always want to buy products emblazoned with the name of a supermarket and Tesco needed to give them new reasons to shop there. ‘As people develop their higher levels of disposable income, they want to treat themselves,’ he said. ‘They do not want to just buy Tesco Value shower gel. They want to have something sat in their bathroom that looks like it is a brand. So you create brands’.”

    In addition, the Guardian reports, Clarke said “Tesco would establish internet operations in all 15 of its markets over the next decade, adding that it should become as good at selling health and beauty products, clothing and telecoms products as groceries.”

    And, Clarke also “batted away the suggestion that investors were growing impatient with the loss-making Fresh & Easy business in the United States, which was criticised by the influential investor Warren Buffett last month. ‘In the end we all know what matters is performance, and I have set some milestones and I think that is the right thing to do,’ he said, referring to his targets for the US chain to reduce its losses this year and break even by 2013.”
    KC's View:
    Illustrating vividly, I think, the difference between “private labels” and “private brands” ... and why the latter is becoming an ever greater factor in US food marketing.

    Published on: May 12, 2011

    Internet Retailer reports that “online retail sales increased 12% in the first quarter of 2011 over the same period a year ago, the second consecutive quarter of double-digit growth and sixth quarter in a row of year-over-year growth, web measurement firm comScore Inc. reported today.

    “E-commerce sales in the U.S. totaled $38.00 billion in the first three months of this year versus $33.98 billion in Q1 2010, comScore says.”
    KC's View:

    Published on: May 12, 2011

    In Connecticut, the Westport News has a piece about a new company called Graze that “recently started delivering all-natural dairy, meat and chef-prepared meals from 29 Vermont farms and artisanal food producers to homes in Fairfield County.”

    One of the founders, Christy Colasurdo, says that the company’s mission “is to support small farms by bringing grocery staples - fresh milk, cage-free eggs, yogurt, cheese and grass-fed beef and other pasture-raised meats - to Connecticut families who regularly purchase these products at retail stores or farmers' markets ... Every Monday morning, two trucks deliver grocery orders and prepared meals placed by the previous Thursday to residences from Fairfield to Greenwich.”

    The company says that it has grown from just 30 families when it started last September to “several hundred” today.

    The company’s website is
    KC's View:
    Maybe the best time to be launching such a business, though I guess that Fairfield County in Connecticut - which has more than its share of fat cat hedge funders, luxury cards, McMansions and all the artifacts of wealth - has a decent shot at supporting such a business. I’m reasonably sure that gas prices could put some pressure on margins, but the Graze business model may compensate for that.

    Published on: May 12, 2011

    • In addition to the new online one-click payments system announced yesterday by Visa, the New York Times writes, “Visa has also been testing a system that lets users pay for items with an application that uses ‘near-field communication’ technology on a mobile device to process a payment. This one-click system will also be wrapped into that service when it is introduced more broadly, the company said. The company says that a customer’s entire financial history could be securely stored in one spot, along with frequent-flier accounts, medical benefits, even appliance warranty information from Best Buy, replacing the jumble of account information that most people have stored in different locations - on and offline.”

    USA Today reports that farmers are saying that “this year's unseasonably cold, wet spring, coupled with drought in the south Plains, (is) likely to lower corn and wheat yields and raise prices.”

    • The Bergen Record reports that Toys R Us “is planning to switch on solar energy systems at two New Jersey properties, including a 20-acre rooftop solar panel installation at its Flanders distribution center, the company's largest distribution center in the nation.” The company estimates that the installation, which will go online this summer, “will save about $366,000 a year in Flanders and $7 million over 20 years.”

    • The Chicago Tribune reports that “Michaels Stores says the debit card fraud stemming from tampered checkout terminals is far more pervasive than initially thought, encompassing not just Illinois but 19 other states. The scope of the crime has surprised security experts and exposed the vulnerabilities of debit cards, a method of payment that many shoppers have come to rely on for everyday purchases.”

    According to the piece, “Debit card fraud is worse for consumers than fraud involving credit cards because little stands between thieves and the money in bank accounts. In the case of Michaels' stores, many customers had money stolen directly from their accounts via ATM withdrawals.

    “The crafts-store chain identified 90 keypads in 80 stores that were compromised in Colorado, Delaware, Georgia, Iowa, Massachusetts, Maryland, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, Ohio, Oregon, Pennsylvania, Rhode Island, Utah, Virginia and Washington.”
    • The Seattle Times reports that at Nordstrom’s annual shareholders meeting yesterday, company president Blake Nordstrom said that store salespeople are beginning to use “Internet-connected devices to hunt for out-of-stock merchandise or complete credit-card transactions without making customers wait in line for a cash register.

    “The company has been testing the devices at its downtown Seattle and Bellevue Square stores.”
    KC's View:

    Published on: May 12, 2011

    • In the UK, the Guardian reports that Tesco has elected Sir Richard Broadbent, deputy chairman of Barclay’s, to be it new non-executive chairman, succeeding David Reid, who is scheduled to retire. Broadbent will step down from Barclay’s when he takes the Tesco job later this year.

    • The Boston Globe reports that Dunkin’ Brands, parent to both Dunkin’ Donuts and Baskin Robbins, has named Neal Yanofsky to the newly created position of president, international. According to the story, “Yanofsky joins Dunkin' Brands from Generation Mobile, a venture-backed retailer of wireless products and services where he served as chief executive. His resume also includes stints as president of Panera Bread, a casual dining chain, and as a vice president of of Fidelity Ventures, the private equity arm of Fidelity Investments.”
    KC's View:

    Published on: May 12, 2011

    Responding to yesterday’s story and commentary about anti-Happy Meal legislation, which would require kids meals containing toys to meet a certain nutritional profile, MNB user Blake Steen wrote:

    This is your best editorial yet.  I completely agree.  My dad is a local legislator and his favorite line is “you can’t regulate stupidity”.  It is very true.  Parents should and most do know what is good for their kids.  Let’s call this what it is, ANTI-CAPITALISM.

    And another MNB user chimed in:

    I agree that the anti-happy meal legislation is over the top. Initially, I agreed with the fast feeders opposition to it but the more I think about it, the less sense it makes, especially for McDonald's. I suspect the impact to sales in San Francisco has been positive.

    Kids who receive happy meals aren't driving themselves to McDonald's and their parents aren't bringing them there for the toy. Parents are bringing their kids there for convenience or as a treat. Most kids will order a burger or chicken nuggets, French fries, and a soda. With the legislation in place, the parents will have to decide to either alter the order to meet the requirements so the kids can have a toy or not alter the order and forego the toy. They could get creative and alter the order to get the toy and order an extra order of fries and/or soda. Either way, the fast feeder either saves money by not having to provide a toy or gains sales.

    The added benefit of the legislation for McDonald’s is that it aligns with their efforts to renovate their locations to project a more upscale image and compete with Panera, Starbucks, etc. Their competition will not gain a differential advantage.

    Fast food only contributes to childhood obesity when parents make it a staple. Case in point. My daughter, who is in excellent shape, is a gifted athlete who participates in school sports throughout the year and softball in the Summer. We eat most meals at home but will have fast food for convenience or as a treat 2 or 3 time a month. She has a friend, who, while in excellent condition, would be considered obese, is also a gifted athlete who also participates in school sports throughout the year and softball in the Summer. Her friend also participates in club sports throughout the year. As a result she is on the go, often until 9:30 or 10 pm and eats fast food nearly every day.

    MNB user Mike Franklin had some thoughts about the inevitability of disintermediation in the supermarket industry:

    I like what Glen said, but, he presupposes that disintermediation will be led by business. In this case agreement with manufacturer and retailer…  However, I would bet that it will be led by the consumer. Reason: the manufacturer and retailer have been enemies for so long, by the time they work out the details…the consumer will have left them far behind…  Doggone those pesky consumers…how did they get so dang smart…OH! The Internet…and business leaders, left behind, will let out a collective sigh as they begin to chant… we should have listened to Kevin!

    I wouldn’t go that far...
    KC's View: