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: March 9, 2012

    by Kevin Coupe

    There is a fascinating story from Bloomberg about how US military psychiatrists continue to grapple with the causes, effects and potential treatments for post traumatic stress syndrome (PTSD), which may afflict as many as 20 percent of the more than two million soldiers returning home from armed combat in the Middle East since 2001.

    Experts say that part of the problem is that there is no consistent diagnosis for PTSD, which makes it hard to come up with a consistent set of tools which which to treat it. “In an effort to change that, the military says it’s trying to find cases sooner by embedding therapists in combat units and spending $40 million to study 20 treatments, some of which may work within weeks. Among them is a therapy that sends some troops on a 45-minute trip through a Wal-Mart store.”

    That’s right. Walmart stores - as well as other big box stores and other high traffic areas such as movie theaters and restaurants - tend to be big and noisy and, to someone suffering from PTSD, potentially filled with dangerous people. According to the story, “Visiting Wal-Mart or another crowded spot is part of a treatment for PTSD called prolonged exposure therapy that encourages a patient to recount traumatic events that cause flashbacks ... The benefits of 10 such therapeutic sessions within either two or eight weeks are being studied, and the early results suggest the treatments are so effective that some active-duty military personnel have been able to return to war zones.”

    Not surprisingly, a spokesman for Walmart had no comment on the use of the company’s stores by military psychiatrists.
    KC's View:

    Published on: March 9, 2012

    The Washington Post reports that “Roland Sturm, an economist at RAND Corporation, analyzed the food environments of 13,000 adolescents in California, looking at how many fast-food restaurants and supermarkets were within a 1.5-mile radius of their homes and schools. He then looked at how much fast food, fresh fruits and other foods the kids consumed. And his study found no correlation between what food sources kids lived near, what the kids ate and how much they weighed ... Sturm doesn’t disagree with the idea that supermarkets can benefit a neighborhood: They provide more food variety and more options for eating healthily. But he cautions against turning to a supermarket expansion as a way to address American obesity.”

    “The idea of a supermarket desert is something everyone is really interested in,” Sturm tells the Post. “The big concern I have right now is there is policy being guided by some spurious findings.”
    KC's View:
    The folks in LA who banned the development of new fast food joints from the South Central section of the city will be disappointed by this study, since they felt that it was a good way to combat childhood obesity and resultant health issues. Still, I’m not sure it is bad thing to stay away from fast feeders ... not a public policy decision, perhaps, but certain a good parental one.

    Published on: March 9, 2012

    Bloomberg reports that Duncan Mac Naughton, chief merchandising officer for Wal- Mart’s US stores, told a supplier group last month that “the retailer’s sales would be higher if some items weren’t out of stock,” and he suggested that fewer out-of-stocks could boost sales by as much as $5 billion annually.

    According to the story, “Wal-Mart has been working for more than a year on improving inventory levels to boost sales. The company hired two firms -- Acosta Inc. in the U.S. and Retail Insight in the U.K. -- to walk the aisles and monitor stocking levels. The company also has pulled its greeters from the lobby to help load shelves.”
    KC's View:
    Having the product on the shelves will make it easier to actually sell it?

    Gee, y’think?

    It’s that kind of insight that separates Walmart from all the also-rans.

    (We kid because we love.)

    Actually, there is one thing that I have heard from several suppliers - which is that Walmart is once again drawing a hard line in terms of price, saying that if suppliers raise their prices - no matter what the circumstances - the retailer will find the items elsewhere, including offshore if necessary.

    As one insider put it to me, the approach seems to be at variance with Bill Simon’s speech last year in which he pledged to work with suppliers because he understood that the Walmart needs them.

    To be continued...

    Published on: March 9, 2012

    Whole Foods announced that it is launching a new online magazine called Dark Rye, which the site says “brings together pioneers of unconventional ideas to explore the edges of the creative life. It’s leisure storytelling steeped in a vision of a sustainable, decadent, and curious life.”

    In the announcement of the venture, Whole Foods says the site will feature “compelling people and content through storytelling with video, photography, recipes and articles. Dark Rye celebrates the movers and doers of our time and aims to motivate and inspire people to take a bite out of life.”

    You can check out the demo site here.
    KC's View:
    Whole Foods is impressive with its commitment to the whole person, and this new magazine reflects it. BTW...I saw the new Wellness Club concept that it is testing outside Boston, offering cooking classes, nutrition instruction, yoga classes and the like .... and it is very impressive.

    Published on: March 9, 2012

    Reuters reports that William Morrison Supermarkets, the UK’s fourth-ranked food chain, says it is “well-placed to resist any attempt by wounded market leader Tesco to make gains in the fresh food battleground after leading the way with its own fresh format stores.”

    The story notes that “last year Morrisons launched a new fresh food concept in 12 stores, introducing 350 more fruit and vegetable products, reducing space given over to processed foods and knocking down walls so customers can see its butchers, bakers and fishmongers in action.”

    Tesco has responded to a decline in its UK market share by promising to build new stores, refresh old ones, spend money on customer service and hire as many as 20,000 people to help staff its fleet.

    But Morrisons CEO Dalton Philips says that his chain will quickly move to roll out the fresh format, and also plans to expand its convenience store business from from three test stores, adding 15-20 this year and as many as 50 next year.
    KC's View:
    It isn’t as if we’ve all discovered that the emperor (Tesco) has no clothes. But I think we’ve certainly come to the realization that one thing Tesco is not wearing is an impenetrable suit of armor.

    Published on: March 9, 2012

    Environmental Leader reports that a new study done by the nonprofit Institute for Local Self-Reliance suggests that “Walmart’s heavily-promoted sustainability initiatives have done more to improve the company’s image than to help the environment,” and that “since Walmart unveiled its sustainability campaign in 2005, the number of Americans with an unfavorable view of the company has fallen by nearly half, but its greenhouse gas emissions are increasing rapidly.”

    According to the story, “At its current pace, Walmart will need roughly 300 years to reach its goal of using 100 percent renewable energy, ILSR claims. As of 2011, Walmart was deriving only two percent of its U.S. electricity from its wind and solar projects, the report says.

    “Walmart’s Greenwash also criticizes the ‘little progress’ the store has made towards its goal of developing the sustainability index for consumer products that it launched in 2009. The chain also regularly donates money to political candidates who ‘consistently vote against the environment,’ according to ILSR.”

    Walmart responded to the study by challenging some of its assertions, and said, “Like anything that Walmart pursues related to sustainability, our goals are ambitious. We didn’t necessarily know how we would achieve them, but we believed then and we continue to believe now that it was the right thing to do for our business and the environment.”
    KC's View:

    Published on: March 9, 2012

    ABC News reports that so-called “pink slime,” described as a “cheap meat filler” made from low-grade trimmings, “is in 70 percent of the ground beef sold at supermarkets and up to 25 percent of each American hamburger patty, by some estimates.”

    The story also notes that “ABC News emailed the top 10 grocery chains in America. Only Publix, Costco, HEB and Whole Foods responded, saying they don’t use pink slime. No word yet from the rest.”

    • ShopRite announced that it is teaming up with nearly 6,000 USDA partners to make today, March 8, “What’s on MyPlate?” Day. To heighten public awareness of the importance of choosing healthy foods, ShopRite says it is committed to promoting a diet that reflects the latest recommendations in the 2010 Dietary Guidelines for Americans and highlights the message behind the new MyPlate food icon.

    • The Associated Press reports that Coca-Cola and PepsiCo “are changing the way they make the caramel coloring used in their sodas as a result of a California law that mandates drinks containing a certain level of carcinogens bear a cancer warning label.

    “The companies said the changes would be expanded nationally to streamline their manufacturing processes. They've already been made for drinks sold in California.”

    The changes are designed to reduce the level of 4-methylimidazole, a chemical that the story says “can be formed during the cooking process and as a result may be found in trace amounts in many foods.”
    KC's View:

    Published on: March 9, 2012

    • Kimberly-Clark Corp has named its current Chief Marketing Officer,Tony Palmer, to the new role of president of global brands and innovation. Palmer will remain in charge of global marketing and a new chief marketing officer will not be named.

    • Delhaize Group announced that Pierre Bouchut, Carrefour’s Executive Director of Growth Markets, has joined the company as CFO. He also will be a member of Delhaize’s Executive Committee.

    Delhaize also announced that Mats Jansson will become the company’s new chairman, succeeding the retiring Georges Jacobs on May 24.
    KC's View:

    Published on: March 9, 2012

    I joked yesterday that not much notice was paid the other day to the introduction of the new iPad, which prompted several comments from readers.

    MNB user Jim Swoboda wrote:

    Hardly any attention indeed:)  I admit to being a hard core gadget guy.  So, after owning the 1st generation and 2nd generation, the 3rd will arrive on my door step on the 16th:)  Call me stupid or addicted!  I'll answer to either.

    I’m jealous.

    Another MNB user wrote:

    One of the things Tim Cook said yesterday is that they sold more iPads in the 4th quarter of 2011 than any line of PCs from any brand. More iPads than HP or Dell or Lenovo sold laptops + desktops. Count my eyes opened.

    Yesterday I talked on “FaceTime” about some positive customer service experiences that I’d had a local deli and with Calphalon and Weber during phone conversations. Got lots of emailed responses...

    MNB user Brendan Carr wrote:

    I also had a very positive customer service story yesterday.  About 18 months ago my wife purchased 2 stainless steel shower caddies at Bed Bath and Beyond manufactured by SimpleHuman.  For a shower caddy, they weren’t cheap - $110 per.  Each caddy has a towel bar that is secured to the unit using a metal spring attached to plastic.  After 18 months, when I tried to move the piece by increasing the tension on the spring, the plastic broke.  I e-mailed the company explaining the  situation and expressing the deficient engineering of the product.  Within two days the company acknowledged my e-mail and said they would replace the pieces free of charge.  They sent an additional e-mail with the shipping/tracking info and I received the pieces yesterday via UPS.   I always agree with you that the last touch point between consumer and manufacturer/retailer is the one you remember and SimpleHuman is now high on my list.

    From another MNB user:

    Funny you brought this up.  I recently was in a Grease Monkey in Boulder, CO having my oil changed and from the minute I pulled in, the customer service was outstanding.  EVERY employee treated me as if they were the owner….and not in an over-the-top, my manager is watching so I better be nice kind of way…but a genuine, I really care way.  I couldn’t help but think at the time that this is what it must have been like in the 50’s when service meant something.  I was telling a fellow co-worker about the experience and he said that he was treated the same way at a different location in a different city.  Something is going on at the top….and it’s working…. people are talking about it.  Thanks.

    MNB user Paul Schlossberg wrote:

    Companies are learning that good service means good word of mouth, or in this case good mentions in MNB. Those reading it today might not live near the deli - but some surely do. But many of us have grills and coffee makers. Facts like these get in to our decision processes when it is time to make a purchase.

    MNB user  Rich Boyd wrote:

    Those companies are all looking forward and they take advantage of consumers like you who talk about them to your friends.

    And, from another MNB user:

    Absolutely love and admire the Weber company. I’ll never buy a grille from another company as long as I live. The service and reliability is unmatched.

    And, to your point, me raving about my overall experience with Weber has influenced a number of neighbors to now own and love their grilles!

    Now that your grille is registered you will probably start receiving their magazine/newsletter. It’s full of great cooking tips, recipes and accessories. Makes you feel like part of a family brilliant!

    Side note….Taylor Guitars is the same way.

    Wish I could take advantage of Taylor Guitars’ customer service. One of the great disappointments of my life is that I don’t play the guitar. About 17 years ago Mrs. Content Guy gave me guitar lessons as a present for my 40th birthday, but after a year, I gave up - these stubby fingers just couldn’t seem to do what I needed them to do. (Maybe there is a reason that I do MNB each day with two fingers - not exactly hunt-and-peck after 35 years as a writer, but I’ve never been able to get my fingers to master the concept of so-called “touch typing.”

    There also is the dark side:
    Let me tell you about the other side of customer service.

    For the past four years a local dry cleaners has been coming to our office and picking up and delivering dry cleaning, it’s been a great service.  Last week I noticed they had scorched one of my dress shirts, so I sent it back with a note asking what had happened.  You should know that I usually average $12-15 a week in dry cleaning costs, maybe $600-700 per year.

    When my shirt came back, attached was a copy of their receipt with their damage disclaimers highlighted - no note, no explanation, no apology.

    I know accidents happen and it wasn’t a new shirt, so if they had made a simple gesture like giving me a week’s free service I would have been satisfied and would still be their customer.  Now, instead of keeping a long term customer for what would have amounted to maybe $15, they have lost me for good.  Oh yeah, I’ve also told everyone else in the office about my experience, so I’m probably not their only lost customer. 
    Makes you wonder.

    Regarding Tesco’s continued efforts to make Fresh & Easy work in the US, one MNB user wrote:

    Just one person’s opinion/observation, but Fresh & Easy appears to be getting some traction, at least in the Southern California market.  I live within a 5 minute drive from two locations and occasionally pop in to see what, if any, changes they’re implementing in the stores.  A couple of years ago, regardless of the day of the week, you could “hear a pin drop” as the stores just weren’t heavily trafficked by shoppers.  Additionally, the lack of volume was reflected in the quality of the goods, particularly in Perishable categories where you would see a fair amount of short coded product on the shelf for sale.  However, today the stores are much busier with customers who seem to be responding to fair prices, good selection and the convenience of getting in and out in a relatively easy manner.

    A couple of years ago I had a meeting with one of the local Southern California grocery retailers and we were chatting about this person’s impressions about the new format that was introduced by Tesco.  While this person’s comments were not overly flattering one comment made a strong impression on me.  He gave a lot of credit to Tesco’s “smarts” and their commitment to making it work in the US and said that one day Fresh & Easy could achieve a 10 ACV of the Southern California market and everyone will be wondering to themselves “how did they do that?”

    From my observations they may be on their way.

    I also wrote yesterday about the potential of subscription models, which led one MNB user to write:

    You mentioned subscription models today and purchasing dog food.  Our family uses our Sam's club that way, with Click n Pull.  I buy all my consumables this way:  Paper and cleaning  (At my age, I only buy "my" brands), my pet supplies (cat and dog food, litter and occasional treats), and all the baby items for my daughter (with year old twins, she goes through a lot of diapers, wipes, formula).

    Every quarter, I log on and and order from my list.  They have usually loaded e values for my purchases and a couple of good suggestions that add to my basket.  In store, the order is  pulled into a cart and is waiting for me at their drive thru entrance within 24 hours.  I pay with my Sams Club Credit Card, and then they load the items into my car and my daughters car.

    Or course, it's called a membership fee rather than a subscription, but it gives me benefits I want and need:  Good price (maybe not the best, but I'll take it), easy to shop (both time and energy), and most importantly, removing a burden from my mind with little effort!  Oh yeah, it has great personal service WHEN I NEED IT, ie loading in the car.  They know my name and are helpful to this "baby boomer" whose bones and muscles are not what they used to be!  In return, they get 100% of my "share of requirements" in all these categories which is a lot of $ for them!    Isn't this just an updated version of Mr Sam's vision:  Great prices and great customer service?  As you know from my previous email, I am ever hopeful for the success of Walmart despite my recent experiences.

    And on another "subscription model" :), thanks for sharing your world every morning!  Having been in the consumer insights field (both cpg and retail) since grad school (a mere 25 years ago!), I have a lot of long time friends/former colleagues who have spread across the country and due to busy schedules, we are time crunched.  However, since we all subscribe to you, rarely a day goes by that we don't have a email chain where one of your topics starts great discussions!  We named ourselves the "Smart Peeps", but smart probably refers to our witty banter and comedy pyramids just as much as our experience and thought leadership!

    We have been known to send one line emails.."did you get MNB yet???"!  Please consider that a compliment...we do miss you when you're gone!

    You are incredibly kind ... and I really appreciate it.

    On Walmart’s decision to increase self-checkouts to save money, one MNB user wrote:

    This is an easy call. Like “ re-positioning” the door greeters till they leave, self check outs are yet another labor saving way to cut expenses. Their goal was to take labor off the sales floor to better serve the customer by adding them to the check outs, now more self- check outs? I would tell you one needs to look at the shrink numbers from self check outs… don’t kid yourself people (not good people) have found ways to beat this system and with no one at the doors….  Good luck.

    From another MNB user:

    I think that, even though Walmart seems to be taking the cost saving attitude toward self-checkout, it will also prove to be an improvement to service. Now I can take advantage of their low prices and don’t have to deal with their rude cashiers.

    Regarding Ron Johnson’s efforts to remake JC Penney, one MNB user wrote:

    Johnson is spending a boat load of money on his vision. True it could work but I don’t think so. Trying to change a customer habits to yours has proven not to be very successful. Reducing assortments to what you think the customers wants or fits into your vision also has seldom worked (see Walmart project impact for their results). JCP customers are not ones who want to see “A” blouse on a glass shelf, nor are the boutique shoppers, at best they are outlet mall shoppers. JCP decision will affect the suppliers and they will go elsewhere for volume. Apparel is a promotional product for the most part on the brand names JCP will be carrying, unless Johnson goes after exclusive which have their own issues.  EDLP is tuff, just ask Walmart, or look at JCP value line which hasn’t done all that well. Keeping inventory low and clean will be a must, as will new.

    So beside re-teaching the customer he will need to do the same with the associates as well. Last night’s commercial on returns… Well again, ask Sam Walton on this. Walmart did this and got two year old riding lawn movers back that look like they hit a tree, but the sign said… Trying to make a mall with in a mall is odd since the numbers show that a high percentage of malls are failing. Johnson has just left the door open for Kohl’s, TJ Maxx, Ross and many other mid range clothing retailers. JCP wasn’t a Saks and doesn’t have their customer based. Last I looked most higher end Malls like the Gallerias don’t have JCP in them. At the end of the day I think Johnson takes JCP over the edge and spends all the cash and walks away with yet another golden parachute.

    I mentioned the other day that Fenway Park has made the National Register of Historic Places, which led one MNB user to write:

    I've been to games at Fenway, old Yankee stadium and Wrigley.  By far, Fenway is the worst place to watch a game.  Yankee was the worst place to walk the halls.  Wrigley was really fun.

    Too bad the historic status will keep them from improving the Fenway experience.  It was hard to actually follow the game there were so many people milling around.  (We were on the first base side.) Glad I went, but for my money, I was there once and that was enough.

    We’ll have to agree to disagree on this one.

    I love emails like this one:

    Great issue today, and I am only half way through.  You obviously are feeling better.

    I have a few comments:

    On the "good service"; I have also noted some really good service lately, from some unlikely places.  As I commented before, Home Depot has really stepped it up a notch or 3.  And the other day, here in South Texas we have Bill Miller BBQ.  It is a good semi-fast food chain with good food, but often left service on the back burner.  Tuesday a friend and I were eating lunch when a manager came to our table to make sure all was ok.  We instantly looked at each other in shock. It has been happening at a lot of restaurants in town lately, but this place was really a pleasant and appreciated surprise.  I think people are finally getting the "service" thing into the right perspective.

    On the iPad/iPhone; I don't have either one, but I must say "YET".  I am very tech savvy, but some things I have to leave at home.  I am however, finding more occasions where it would be nice to be able to look up something rather quickly on the internet when I am not near a computer....This boomer may get there yet.

    On JC Penny; I like you, am looking forward to checking out the new formats and pricing.  I have not been in a store in years, but it used to be my favorite store.

    And lastly, your constant talking about; I finally made my first purchase and I loved not only the experience, but the prices.  I just never wandered there.  I know now to always check there first!

    I feel like my work here is done...
    KC's View:

    Published on: March 9, 2012

    There are just a couple of things that I’d like to get off my chest this morning.

    One. I like beer. Always have. To quote the late, great Robert B. Parker, “The worst beer I ever had was wonderful.”

    That said, I have to admit that I was appalled this week to read in the Wall Street Journal about how some brewers are testing iced tea flavored beer as a way of improving sales.

    I’m sorry. I like iced tea, and I like beer...but I have no interest in having them together in the same glass.

    You want to build beer sales?

    Make better beer.

    Two. I want to be very clear about this, because I am a person who depends on my sponsors for the financial support to keep MNB going.

    Under no circumstances will I ever think of my sponsors as french fries, and if I lose one, I would never think - or say - that it is like “losing a couple of French fries in the container when it's delivered to you at the drive-through ... You don’t even notice it.”

    Not only would that be a dumb thing to say to departing sponsors who had been supportive of me, but it would be a supremely arrogant thing to say to existing and potential sponsors, who rightly could expect greater appreciation and even discretion.

    Of course, there are a lot of things that I would never think or say out loud. And when I think about it, suggesting that my sponsors are as disposable and insignificant as french fries probably is just the beginning of what I would not say or think.

    If you get my meaning.

    Enough said on that subject.

    I thought this was pretty interesting. (It would have been an eye-opener, but I already had one this morning...)

    Business Insider reports that a study by an organization called Netcraft says that there currently are 644 million active websites on the internet, but that it continues to grow “by leaps and bounds. he March numbers were up by 31.4 million (5.1%) over last month.

    “Plus, nearly six million domain names were added to the Internet in the fourth quarter of 2011, bringing the total to 225 million domain names worldwide.”


    Y’know, this whole internet thing may actually catch on.

    Don’t forget...most of us in the US will lose an hour’s sleep on Saturday night...since daylight Savings Time goes into effect in the majority of the country at 2 am Sunday morning.

    I have four wonderful wines to recommend to you this weekend. Two of them have become instant favorites - the 2010 Ka Albarino and the 2010 Albarino D Fefinane, both of which are fine examples of that most delightful of Spanish white wines.

    And, there was the 2007 Petizos Malbec, which is great with beef, and the 2009 Poggio Capponi Chianti, perfect with spicy Italian.


    That’s it for this week. Have a great weekend, and I’ll see you Monday.

    KC's View: