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    Published on: September 28, 2012

    by Kevin Coupe

    Look, I'm an Apple guy. Have been for as long as I can remember.

    That doesn't mean I don't appreciate the competition. As a committed Apple user, I'm never threatened by the idea of innovative competitors to the company - I think that it will only drive everybody to be better. In the end, that's good for all of us.

    A version of the TV commercial at left has been running on the various television networks, but I think the full 90 second edition is worth watching. It is for Samsung's smartphone, and takes some well-placed and humorous shots at the Apple iPhone 5.

    It is very funny. It is very savvy. And it is a great example of how to compete effectively, even against a company that too often is seen as something more than a terrific technology company. (As if being a terrific technology company isn't enough.)

    Enjoy. It is an Eye-Opener.

    KC's View:

    Published on: September 28, 2012

    The Chicago Tribune reports that Ahold-owned Peapod, the e-grocery retailer, is making a broad commitment to the concept of virtual supermarkets that can reach out to customers in high-traffic locations. The concept - similar to one pioneered by Tesco in South Korea - allows people to shop by using a smartphone application to make purchases from billboards that feature pictures of products and QR codes, and then have the products delivered to their homes or offices.

    According to the story, Peapod is "expanding its interactive virtual supermarket concept to 17 different train and subway stations in the Chicago area, beginning today." And, "Virtual shelves will also go up over the next week at dozens of stations in Boston, Connecticut, New York, New Jersey, Philadelphia and Washington, according to a Peapod spokeswoman."

    Peapod tested the concept in Chicago earlier this year, and is expanding it because it saw sales increases for products featured on the billboards.
    KC's View:
    From the very first time that I saw video of this system in action, I thought that it was insanely cool ... and the harbinger of a trend likely to take hold. I hate to quote myself, but here's what I wrote some time back...

    "The lesson here seems clear - that more and more, companies are finding ways to communicate with shoppers outside the confines of the store, while at the same time, shoppers are looking for ways to shop without actually going to the store. It is an enormous challenge to traditional retailers, which have to find ways to lure shoppers into the store, or find ways to reach beyond their traditional borders."

    Published on: September 28, 2012

    The Wall Street Journal reports this morning that plans to open an online wine store, re-engaging with an idea that it first considered several years ago.

    According to the story, Amazon hosted a meeting in Napa, California, this week that was attended by representatives from about 100 wineries. At the event, the Journal writes, "Amazon said the marketplace would begin in the coming weeks and the online retailer will charge wineries a 15% commission of the sale price, as well as a monthly fee of about $40, according to people familiar with the workshop."

    The story goes on:

    "In 2009, Amazon pulled back from an effort to sell and ship wine after its partner, New Vine Logistics, suspended operations amid financial troubles. This latest effort would spare Amazon the cost and difficulty of shipping fragile and heavy wine bottles by passing that responsibility on to the vineyards themselves.

    "Wine sales online are challenging due to a patchwork of state-by-state rules that limit which companies can sell alcoholic beverages. And shippers must ensure that recipients signing for packages are at least 21-years-old, the legal limit."
    KC's View:
    Less than one percent of the nation's wine sales take place online. At the moment.

    I've always felt that Amazon would try to find a way through or around all the regulatory issues, because wine just seems like such a natural segment for it to try to disrupt. And make no mistake about it ... that is exactly what Amazon is going to try to do here.

    Published on: September 28, 2012

    Kroger-owned Ralphs Grocery Co. said yesterday that it will spend $1.1 million to resolve an investigation into accusations that it was overcharging customers. Ralphs will pay $1 million to the offices of the district attorney and city attorney and $100,000 to the Los Angeles Regional Food Bank, but continues to maintain that this is a business decision, with no admission of guilt or liability.

    According to the Los Angeles Business Journal, "the City Attorney’s Office said that settlement comes as a result of an investigation that the L.A. Department of Weights and Measures began in 2010. Inspectors visited various Ralphs stores throughout the city and discovered that the grocery company repeatedly charged customers more than the price posted, as well as selling smaller quantities than was advertised. The stores also frequently failed to deduct the weight of food packaging for deli items, including ice weight on seafood items."

    In a statement released by the company, Ralphs said, in part:

    "After an almost 3-year-old investigation regarding allegations occurring in 2009 it found what we already knew. Ralphs is industry-leading and will continue to be when it comes to providing our customers accurate pricing and precise labeling. We take these matters very seriously and any inadvertent discrepancies were corrected immediately for our customers ... As a judge noted back in 2010, even at that time, Ralphs had 99% accuracy on labeling and weighing its goods as well as an impressive Weights and Measures and Price Integrity program in all our stores. Clearly, there is nothing misleading nor unfair to Ralphs' pricing. Ralphs has continued to improve in this area."
    KC's View:
    Ralphs also notes in its statement that "each Ralphs Grocery Store has approximately 50,000 individual items, with 9,000 price changes each week." Based on that, it is amazing that more mistakes are not made.

    Published on: September 28, 2012

    Slate has a good piece arguing that the much-talked-about bacon shortage that became a topic of conversation earlier this week probably won't take place ... though it seems likely that bacon will be more expensive.

    The original story grew out of a report from the UK's National Pig Association, which said that drought conditions around the globe, which affected pig feed, would result in fewer pigs and therefore less bacon.

    Any bacon shortage, Slate writes, actually will be "a global increase in meat prices as a slightly delayed downstream consequence of the increase in corn prices." And corn is what you feed pigs to fatten them up.
    KC's View:
    It is a good piece, especially because of an interesting digression on what different countries call "bacon," which is not the same for everybody. You can read the whole thing here.

    Published on: September 28, 2012

    • The Chicago Sun Times reports that Roundy's-owned Mariano's plans to open a store at 16th and Clark Streets, in the city's South Loop, in the fall of 2013.

    • The Seattle Times reports that "Starbucks will open its first outlet in India by the end of October in an upscale neighborhood of Mumbai." The company had projected that it would have 50 stores in India by the end of the year, but it will not get anywhere close to that goal.
    The store is, in keeping with India's rules, a 50-50 joint venture with Tata Global Beverages, called Tata Starbucks Ltd.

    • The Associated Press reports that "Dunkin' Donuts says it will start using cage-free eggs in its breakfast sandwiches and eliminate 'gestation crates' from its pork supply chain." The story says that Dunkin' "will transition 5 percent of its eggs to cage-free by the end of next year; it did not set a timeline for completing the switch."
    KC's View:

    Published on: September 28, 2012

    • In Thursday Night Football action - featuring the regular officials, as opposed to the replacement referees who took their place during a lock-out by NFL officials - the Baltimore Ravens defeated the Cleveland Browns 23-16.

    • As a point of personal privilege, I'd like to point out that R.A. Dickey, the knuckleball-throwing pitcher for the often-hard-to-watch New York Mets, won his 20th game of the season yesterday with a 6-5 victory over the Pittsburgh Pirates. He is the first Mets pitcher in 22 years to win 20 games.

    The New York Times writes that Dickey, an "author, mountain climber, (and) journeyman turned ace," has become "baseball’s most unlikely star — a 37-year-old reclamation project who throws the only knuckleball in the majors, speaks more like a professor than an athlete, wins game after game on a bad team and has increasingly turned his career into an American sports fable."
    KC's View:

    Published on: September 28, 2012

    Yesterday's "FaceTime" commentary was about how Kraft gave Target an exclusive, Halloween-themed Oreo, made with a vanilla cookie and candy corn-flavored creme, and when I went to find it, I discovered that Target buried it with no mention of it being special or exclusive. I wrote:

    "I do think it is worth pointing out that when you have something unique, or exclusive, or distinctive, or differentiated, it is your job as a retailer to draw attention to the damned product! Sell, damn it!"

    This generated some response...

    One MNB user wrote:

    Your Face Time commentary brought to mind a similar experience that occurred yesterday but happens all too often.  I went to buy a DVD at our local grocery store that had a “Buy the video, get these products Free” in their front page ad.  However, the DVD is purchased in their Electronics dept. and the groceries are in the other other part of the store.  When I pointed out to the electronics manager that they should display the products together he shrugged his shoulders and said the groceries were in the grocery dept. And of course, when I found the product on the shelf (no displays) the flavors I wanted were out of stock.  This happens all too often at this retailer and others too.  Do you think there is disconnect between the HQ and the stores?

    Another MNB user wrote:

    Big Box retailers run their business via processes, not people. It's a shame, but it's a real advantage for a true merchant to compete on something other than price.

    From another reader:

    I’m just wondering if the Oreos are stocked by Target employees or by Nabisco personnel.  As a former Keebler sales rep long ago and far, far away, I’m surprised that the local Nasty Biscuit (ah, friendly competition!)  office wasn’t making sure there was ample POS posted.  On the other hand, some chains have restrictions on what POS ads can be posted and where (at least in my day that was true).

    But I agree. Exclusive product and no promotion?  I’d be pushing the HECK out of it.

    And another reader: 

    It would be interesting to know where the breakdown occurred with this promotion. Was the issue with Kraft, who obviously invested a decent sum of money on testing, formulation, and packaging, but possibly had no plan beyond getting it in a box and delivered to Target, or did the execution die within Target's corporate marketing and promotion department, or did you just visit a store who's manager didn't give it the push you expected?

    For the record, I have  to say that I loathe these package and item exclusives to certain merchants that the marketing people dream up, leaving independents (usually) out of the loop. I'm glad to know they've stumbled with this one.

    And another MNB user chimed in:

    In South Carolina the "special Oreos for Target" only are on allocation with the Target stores in Greenville putting out 1 case each morning first come first served. Asked Manager about it and he stated they did't know if they would get anymore than initial shipment and don't war to run out; what's worse burying then in their cookie aisle or having an empty display at the checkout every morning at a little after 8:00a?

    Seems like both Target and Nabisco blew it on this one!

    MNB user Tom Nygaard wrote:

    To be cliché; long time reader, first time responder – All I can say is Target’s retail store execution is not what it used to be. I totally agree with the thoughts expressed about what you found at the Target store you visited.

    My local Chaska Target Superstore did have the cookies highlighted on a front end cap amongst the Halloween candy. Maybe I have a high profile store since this is one of the few Target stores that also has 4 self-check-out lanes (that’s another discussion). My only question is did you check out other Target stores within your area and find the same lame retail store execution? Speaking from personal product experience, what use to be Target’s strength seems to be very hit & miss at times.

    Only have one Target store near me. Just checked the one. You make a fair point.

    From another reader:

    As a retail grocery manager across several chains, I agree with your sell, dammit quote.  But I would offer this:  Nabisco has historically been a poor performer in bring these types of items to market. The supply is usually way under demand and there is little chance that you will not sell out before the holiday.  Usually, stores sell out weeks before the holiday and just get grief from customers that you don't have any if the seasonal product closer to the holiday.  I may be wrong about target, but if you go back in the last week of October and you will probably find the Christmas Oreos.

    MNB user Carter Calico wrote:

    You should try the White Chocolate Candy Corn flavored M&Ms at Walmart. You will find them in the Halloween section under the ‘novelty’ section (Merchandised appropriately)

    And still another reader wrote:

    You touched on something in the Target article that I experience often when selling them. Target is so programmed with their various initiatives that many “cool” items are just not promoted beyond the shelf.  They won’t even allow a special sign. While I admire their discipline toward a clean shopping experience with clear sight lines, I am often reluctant to take cool items to them to introduce to the market.  Selling is as much about great in-store execution (displays, signing, demos, etc) as it is about just finding the right selection.  In many ways, Target has lost this.

    And from MNB user Tom Dollinger:

    I was very disappointed to see the candy cane Oreo exclusivity.  We let Nabisco (Mondelez, as of October 1) know about our frustration.  It should not be the national brands job to drive consumers to a certain retailer.  They should be creating demand for their products and brands holistically across all retailers and channels. There response was that any retailer can customize products with Nabisco, but the constraints are such that the scale needed can only be achieved by very few retailers.

    My question to you is did you buy any else while you were searching for the candy cane Oreo?  Maybe that was part of their strategy to drive customers to the store and have them shop around for the Oreo, almost like Costco plays up the “treasure hunt” shopping experience.  I do agree with you though that it should have been on a huge end cap to draw consumers in.  Target could do a significant amount of volume on that one SKU approaching Halloween.

    Nope...I didn't buy anything else. I was on a mission...

    We had a story yesterday about how more than 60,000 consumers are pushing a number of retailers to pull off their shelves “Waggin' Train” brand chicken jerky dog treats, which were made in China and have been linked to hundreds of dog deaths.

    One MNB user responded:

    When will we as a nation realize that made in China is a warning label.  I’m one of those who lost several generations of feline family members from the melamine poisoning epidemic a few years ago and am infuriated that they are apparently doing it again.

    Several MNB users wanted to chime in on the discussion of a class action gender discrimination suit at Costco...

    One reader offered:

    It is unfortunate that this suit has been treated differently than the Walmart suit because of the size of the class action.  It seems that a larger percent of disgruntled employees carries less weight than a smaller percentage.  If the facts are present to proceed it seems that size should not matter.

    As an employee of Costco for more than 25 years who worked his way up through the ranks, some of my best managers/mentors have been females.  Our business has never been about gender, orientation, or ethnicity, but has always been about identifying and grooming PEOPLE who had a "make it happen" attitude and were interested in taking care of our members and the Company.

    I am not going to claim that there are not instances where a manager at any level may make decisions that do not line up with the Companies core values but that does not make it systemic within the organization.  People are going to make poor decisions and our Company does have internal checks and balances to address any issues that are not on the right side of the line regarding discrimination of any type.

    From another reader:

    While I don’t disagree, that over the years, there has been Gender Discrimination in the workforce, how far back are we going to dig, and just what is an appropriate percentage/number that is going to satisfy the groups/lawyers? To assume that Costco is guilty because some radical law fund, based in Berkley, CA, has successfully navigated the system and been able to convince an appointed California District Judge to elevate the suit to class status is folly. Costco is a quality, very well-run company, that is grounded in principles that serve its customers and employees well. Even Wall Street has had its differences with the wages and benefits Costco has steadfastly maintained for its employees. This really doesn’t sound like the type of company that would “practice or tolerate gender discrimination.”

    And, inevitably, we got this email from another MNB user who frequently writes in:

    I'm sure there are a lot of men who don't get to be general managers at Costco either.  Probably for the same reason the three women didn't get to be promoted - the company doesn't think they are good enough.  We have too many silly laws that clog up the courts.  Businesses should be able to hire, fire, promote, demote as they please for any reason or no reason at all.  People should work their way up by being rainmakers and not through litigation.  No company wants to hire and employ trouble-makers.  I wonder if these women realize they are making themselves permanently unemployable?  I would never hire a person who had sued their former employer over a promotion issue.  If someone is such a good employee competitors will be lining up at their door to hire them.  We don't need a court system to decide who gets promoted all we need is Charles Darwin.

    Nobody I know thinks that litigation ought to replace hard work and achievement as a way of moving up through an organization. Nobody I know believes that less qualified and accomplished women should be promoted ahead of men just because they are women.

    But let's be clear. There are companies where a kind of old boy's network has prevented women from getting ahead because they are women. And it is an almost perfect illustration of that kind of mindset when someone writes in and suggests that women who believe that they have been treated unfairly because of their gender and object to such treatment are making themselves "unemployable" and therefore should shut up and take what they are given, as opposed to what they have earned and deserve.

    I can't pre-judge the suit's legitimacy, though I would say that I'm surprised that Costco is the subject of the suit; discrimination would not appear to be part of its DNA.

    It is easy to politicize the suit by suggesting that it all is because the women are troublemakers and are being enabled by a bunch of Berkeley lawyers and an appointed federal judge. But it seems to me that all this does is serve to marginalize the problem, to pretend that the real problem is the women and the lawyers. That's not always the case.

    Where there is injustice, people have a right to raise their voices. If it is proven that this is an illegitimate suit, then shame on the people who brought it. But if it is proven that discrimination has taken place, who among us would suggest that a spotlight should not have been trained on it, so that it won't happen again?
    KC's View:

    Published on: September 28, 2012

    It has been a busy week, with lots of travel and meetings and speeches, and so there hasn't been a lot of time to watch movies and television - so there are no reviews I can offer on these fronts.

    But because I've been spending time on airplanes, I did have a chance to read a just-published, first-rate new thriller by a first-time novelist. "Black Fridays" (Putnam - $25.95) is by Michael Sears, a former bond trader, and it is a classic case of write-what-you-know. Sears has created a fascinatingly flawed hero - Jason Stafford, a former Wall Street investment wiz who has just completed a two-year prison term for fraud. As he tries to put his life back together on the personal front, Stafford is asked by a major investment firm to investigate questionable trades being done by one of its employees; the firm is looking at a big merger, and needs to be sure that it won't be undone by a federal probe.

    As Stafford readjusts to the world outside of prison, he re-immerses himself in the intoxicating world of Wall Street, and this is where Sears excels. He makes even the most arcane procedures and products accessible, and builds his story along parallel lines, paying equal attention to the financial and personal mysteries that Stafford must solve as he puts his life back together. It is a gripping first effort, and it appears that this is just the first of a series of Jason Stafford books. I'm looking forward to them ... and perhaps even to the movie version of "Black Fridays," which inevitably will star George Clooney.

    Check it out.

    It has been a fascinating week with some really interesting restaurants visited, ranging from the Vinsetta Garage in Detroit, where I enjoyed a delicious burger made from double Angus beef patties, American cheese, lettuce, tomato, onion, chopped pickles, maple bacon, and special Vinsetta Burger Sauce ... the Bastone Brew Pub in Royal Oak, Michigan, where I enjoyed some amazing salmon and, go figure, a delicious 2011 Dona Paula 'Los Cardos' Malbec ... and a wonderfully juicy BLT made with heirloom tomatoes at a place called Bramble & Hare in Boulder, Colorado. Not to mention a lovely 2012 Santa Cristina Chianti Superiore, which is just a little lighter than a Chianti Classico, and just delightful.

    And the week ain't over yet.

    "Homeland" returns this weekend. Showtime, Sunday evening. Yippee!

    That's it for now. Have a great weekend, and I'll see you Monday.

    KC's View: