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    Published on: October 2, 2012

    by Michael Sansolo

    The advertisement begins with a young man winning a new job. When his new boss says, “Welcome aboard,” and extends his hand in congratulations, the young man begins a strange routine; grasping the proffered hand, slapping it, bumping it and so on until, strangely, a car horn sounds. Hearing the sound the man stops and completes a simple handshake.

    We next see the same guy as he’s about to apply too much cologne, bet far too much money at a casino and inappropriately kiss a date. Each time a car horn sounds just as he is about to do the wrong thing. Each time he stops and takes a more sensible course.

    In truth, I didn’t get this ad the first time I saw it. (Kevin and I discussed it and he admitted the same. We both enjoyed the ad, but neither of us knew what it was selling.) Then on a second or third watching, it becomes clear. It’s a very clever ad for a new feature on the Nissan Altima that alerts you when you are over-inflating a tire. As the voice-over reminds you, “now you know when to stop.”

    You can watch the commercial here.

    A less clever, but much more direct version of the same theme has just come out from Honda through a series of ads addressing the cause of most car accident: the driver. Honda’s ads for the Accord go through the distractions that cause drivers to lose attention and show how the car helps make the driver better and safer. See it here. And Cadillac has ads touting how the XTS model’s seat shakes to warn the driver of potentially unseen problems. See it here.

    Why do these ads stand out? Because in these campaigns the car companies seem to be leaping to a new plateau in customer behavior: they are dealing with the reality of who we are. No longer are they selling problems we didn’t know we had or aspirations beyond our lives. Now they are giving us what we really need. Because truth be told, most of us have no idea when to stop, whether it’s filling a tire or betting in a casino. And most (if not all) of us get a little distracted while driving and sometimes start moving into an already occupied lane or worse.

    The car companies have figured out how to help save us from ourselves. It’s a lesson the supermarket industry, which obviously interacts with the shopper far more often than auto makers, needs to consider.

    Let’s be real: no matter how many cooking shows they watch on television, most shoppers are less than stellar cooks. Many struggle coming up with recipes or selecting produce or meat. That’s why the industry has correctly made products easier to cook - so that dinner gets on the table with less effort than ever.

    The car companies are showing that you can go further by helping save shoppers from themselves. Already there are retailers who have elements of this. There are stores where produce displays feature information explaining how to better select items, how to judge their sweetness, how to understand how they ripen and how to serve them.

    But the truth is that most stores I visit aren’t doing anything like this. Even the well-intentioned efforts on nutrition information frequently leave me puzzled. Too often I see signs featuring numbers that I don’t fully understand in a type size that I’m never going to read. If my car can tell me when I’m making a mistake, why can’t a sign in the apple bin help me understand that a Cortland is better for baking while a Macoun is great for snacking?

    Let's be clear. There are retailers out there that are very good at providing good information in some categories. But it is hard to find, with some exceptions, a high level of consistency throughout the industry - the kind of consistency that puts distance between the supermarket business and the companies that want and need to nibble away at its share of stomach.

    Right now the opportunity is there because the need is definitely there. It takes very little help to save us from ourselves…but someone must give that help.


    Michael Sansolo can be reached via email at msansolo@morningnewsbeat.com . His book, “THE BIG PICTURE: Essential Business Lessons From The Movies,” co-authored with Kevin Coupe, is available by clicking here .
    KC's View:

    Published on: October 2, 2012

    by Kevin Coupe

    The Daily Mail reports on a classic misstep by Austrian retailer Billa, which decided that it wanted to make bananas easier to eat.

    So, it peeled a bunch of bananas, packaged them and wrapped them in clear plastic wrap ... ignoring the fact that bananas already sort of come wrapped.

    It wasn't just the redundancy of the effort that annoyed customers. It was the fact that the wrapping seemed utterly without regard for the environment. And they made their displeasure known on the internet, via social media ... which, ironically, is where Billa publicized the product to begin with.

    Give Billa credit for knowing when to back off. As soon as the negative reaction began to get traction, Billa pulled the product and admitted that it had made a mistake.

    Which is pretty much one's only option when one has slipped on the proverbial marketing banana peel.
    KC's View:

    Published on: October 2, 2012

    Notes and comment from the Content Guy, attending the California Grocers Association (CGA) Strategic Conference...

    PALM SPRINGS - It may have been 105 degrees outside, but inside, Terry Jones was creating both light and heat in his discussion of innovation.

    Jones, who founded Travelocity.com and currently serves as the chairman of travel site Kayak.com, gave a rousing presentation in which he urged attendees to embrace technology-fueled, customer focused innovations that can change their relationships with shoppers. Such innovations, he said, made it possible for the world to simultaneously be their market as well as their competition.

    "The balance of power has tipped to the buyer," Jones said. "We have very empowered buyers." And so, he said, businesses have to rewire themselves if they are going to relevant to these empowered consumers.

    Jones talked about how Travelocity changed the travel industry. Before the internet, nine out of ten trips was booked through a travel agent, but technology essential allowed companies like Travelocity to disintermediate an entire industry. Almost seven out of ten trips now are booked online, he said, and the online travel business has grown into a $290 billion industry. Traditional businesses, Jones said, have to be constantly innovating and creating cultures friendly to innovation, or they risk the same fate as traditional travel agencies. And, he suggested, the business world is littered with the carcasses of companies and executives who were convinced that it could not happen to them.

    BTW...Jones has a book coming out soon, entitled "ON Innovation." Looks like it will be a good and provocative read...
    KC's View:

    Published on: October 2, 2012

    Seattle-based PCC Natural Markets said yesterday that it has written a $100,000 check to support a Washington State initiative that would require the labeling of genetically engineered ingredients in products.

    According to the announcement, a campaign is underway to put “The People’s Right to Know Genetically Engineered Food Act" on the ballot in November 2013, and PCC "is committed to supporting the statewide campaign – called Label It WA – with a cash donation, and by involving business partners and shoppers with a campaign in its nine stores."

    “There are few issues that threaten so fundamentally our core values as the hidden presence of genetically engineered ingredients in our food supply,” says Tracy Wolpert, PCC’s CEO. “We believe consumers have a right to an informed choice. PCC has been involved in advocating the right to know about GMOs since the advent of rBGH in milk in 1993. We are compelled to do all we can to put I-522 before voters next year.” 

    The Washington State initiative is described by PCC and the Seattle Times as being "very similar" to California Proposition 37, which is on the ballot and will be voted on this November 6.

    Opponents of GMO labeling mandates say that it creates government regulation where none is needed, while proponents say that the bill will lead to needed transparency by retailers and manufacturers.
    KC's View:
    I'm not entirely sure how similar the Washington State bill is to the California version; I've read the “The People’s Right to Know Genetically Engineered Food Act," and it looks to me like retailers could be held responsible for products that don't meet the mandates, and that there is plenty of opportunity for lawyers to get rich no matter what side they represent. (Legislation can be tough to decipher. God, I wish they'd write in plain English.)

    I believe in GMO labeling, but I am persuaded that the California Proposition is hardly the best way to go. It puts the onus on retailers and is going to make too many trial lawyers wealthy. I also think that a national approach would be better. But, it appears the California approach may be the price that the food industry will have to pay for not taking the initiative on labeling before the government got involved.

    Published on: October 2, 2012

    The New York Times reports that the US Federal Trade Commission (FTC) is "updating its environmental marketing guidelines for the first time since 1998 because the number of companies employing them had grown substantially, while the claims themselves had become more ambiguous ... The (revised) guidelines include a tougher-than-expected requirement under which companies must do a sort of trade-off analysis, verifying, for example, that the environmental damage caused by long-distance shipping does not outweigh the benefits of importing recycled material."

    The goal is to be more specific about claims and make sure that companies can back up their claims.

    According to the Times, "The Green Guides do not cover some other familiar environmental labels used by companies, however, including claims of being organic, sustainable or natural. In the case of sustainable or natural, the commission said it did not have enough basis to define and substantiate those claims. Sustainable, for example, could mean that a product was durable as well as refer to how it was made."
    KC's View:
    Transparency and accuracy are everything. I'm sure a bunch of people will suggest that the last thing we need is new guidelines, but it also strikes me as irresponsible not to update regulations to reflect changes and advances in what we know and what companies do.

    Published on: October 2, 2012

    The National Grocers Association (NGA) is out with its 2012 Independent Grocers Financial Survey. Among the results:

    "Despite the challenging economic environment, the independent sector held their own, posting an average net profit before taxes of 1.12 percent in fiscal year 2011. Independent grocers also grew same-store sales by 2.6 percent and improved gross margins across key store categories."

    "With continued economic woes and their far-reaching impact on the shopper, independents were faced with difficult decisions relative to pricing and margins in an inflationary environment. Same-store sales among independents increased over 2011 by 2.6 percent, but once adjusted for food-at-home inflation, the independent sector lost ground at a rate of -2.2 percent. However, the total store gross margin increased to 26.33 percent, with important gains in key departments. This ultimately translated in increased net profits before taxes of 1.12 percent of sales in 2011 from 1.08 percent in 2010 among independents."
    KC's View:

    Published on: October 2, 2012

    Reuters reports that several Walmart employees "who say the world's largest retailer's labor practices are unfair voiced their concerns to Wall Street analysts on Monday, claiming that problems like long lines and empty shelves are systemic. Five employees, two of whom have worked for the chain for more than 20 years, outlined problems they see, including unsafe conditions and low wages ... The meeting, organized by the United Food & Commercial Workers International Union, brought the employees' complaints to an audience that is typically more concerned with Walmart's bottom line. They tried to convince analysts that issues such as low levels of staffing can lead to poor customer service, and therefore can impact sales and profits."

    The story notes that the meeting was attended by a "handful" of analysts.
    KC's View:

    Published on: October 2, 2012

    According to new research from the National Association for the Specialty Food Trade(NASFT), "Nearly two thirds of consumers said they purchased specialty foods within the past six months, a healthy 11 percent increase over 2011, and a big jump from the 46 percent who reported buying these products in 2009 ... Chocolate is the top specialty food purchase reported for the second year, but cheese and yogurt show big jumps. Men are buying more specialty food than ever before, and social media is abuzz about specialty food, with Facebook the predominant platform."

    The report goes on:

    "The prototypical specialty food consumer is young, affluent, and lives in the West or Northeast, according to the research. More than seven in 10 consumers purchase specialty foods in the West and Northeast, with Midwesterners the least likely to make such purchases. After chocolate, the top specialty foods purchased this year are olive oil and other specialty oils, cheese and yogurt/kefir. Younger consumers are more likely than average to buy convenient and easy-to-prepare foods, including beverages, salty snacks, cookies, salad dressing and cooking sauces. Those older than 65 are often the least likely to buy within these categories."
    KC's View:

    Published on: October 2, 2012

    • In Minnesota, the Star Tribune reports that "Nash Finch Co. has agreed to pay $188,500 in back wages and interest to 84 women who were rejected for entry-level positions at its Lumberton , N.C., distribution center ... To settle allegations of discrimination against female applicants, the wholesale food distributor also agreed to offer jobs as they become available to up to 12 women who unsuccessfully sought positions as order selectors in 2006."

    Nash Finch denied guilt or culpability, but said it was entering into the agreement to avoid the costs of litigation.

    • The National Retail Federation (NRF) is predicting that US retail sales growth during the upcoming end-of-year holiday selling season will be just 4.1 percent, compared to 5.6 percent last year, because of ongoing consumer concerns related to the persistently high unemployment rate and the so-called "fiscal cliff" that the country is facing, and the extent to which these concerns are fueled by a discordant and relentlessly negative presidential campaign.

    Consumer Reports is out with a story saying that people who buy store brands instead of national brands will save "big bucks," or an average of 25 percent."

    According to the story, "In comparing store-brand and name-brand versions of 19 products, our savings ranged from 5 percent (frozen lasagna) to 60 percent (ice cream). Many of those store brands were also as tasty as the alternative." And, the story adds, "Nutrition for the pairs is similar."
    KC's View:

    Published on: October 2, 2012

    • James Burke, the former chairman of Johnson & Johnson who, during his tenure there, set the gold standard for crisis management in steering the company through the 1982 scare when seven people in the Chicago area were killed by cyanide-laced Tylenol tablets, has passed away. He was 87.

    The culprit was never identified in the Tylenol case, but Burke's straightforward approach allowed the company to maintain its strong reputation and level of trust with consumers.
    KC's View:

    Published on: October 2, 2012

    We had a story yesterday, taken from a Pew Research Center study, about the growth in mobile computing and how people use tablet computers and smartphones.

    Which led MNB user Alison Kenney Paul to write:

    Kevin—fascinating info from PEW….we recently did some in-depth research on mobile use and found that it has a major INFLUENCE on shopper behavior…it’s not just about a transaction…it’s about researching, looking for stores, checking on store hours…etc. and found that shoppers using a smart phone are 14% more likely to purchase in store….another reason for retailers to embrace Wi-Fi and apps.

    Agreed.




    On another subject, an MNB user wrote:

    At least more people are beginning to share my cynicism towards Apple’s business model being like Microsoft, although I wouldn’t call Microsoft nearly as monopolizing as Apple. The iPhone 5 changes should come as a surprise to NO ONE. Apple’s whole business model is to make small, incremental changes to their product line in a very rapid cadence and since their products are so proprietary and it is impossible to do any upgrading at all to the product (look at the new Mac Books as an example of this, as well as iPods/iPhones/iPads), you are basically forced to buy a whole new devise and pay a hefty price for the next new thing if you want it.

    To further compound the issue and fuel sales, Apple’s marketing campaigns are aimed at young people who may or may not be financially responsible. I know that’s a broad statement and anybody can find an exception to it, but I think it’s generally a true statement if you watch their ads. It still dumfounds me that a high schooler or college student would gleefully wait in line for hours to pay $300 or more for one of these devises and then turn around and do the whole thing all over again six months later, not because there is anything wrong with the devise they just bought, but because Apple sand-bagged their technological advancements and now the new devise is just a “must-have” and the old devise is so “six months ago”.

    As these devises become more accepted and ingrained in the lives of people over the age of 30 or 40, I would expect this cynicism to grow and Apple sales to somewhat slow down.





    On the subject of gender discrimination, one MNB user wrote:

    Because men statistically make more than women is not by itself proof of gender discrimination.  It's an easy assumption to make - that the cause is an intentional attempt by men to keep women out of the top spots.  If so, where's the examples of such blatant suppression, the proof?  Any smoking guns?  I'll venture that the response is that it's so much more subtle, and that men don't even realize they are doing it.  Ok, then it isn't intentional after all.  And if not, it doesn't seem like there's much of a case for this discrimination.

    In my long career in business, I've never experienced or seen any actual gender discrimination.  Yes, I've seen men get promotions that women wanted, as well as the reverse. From everything I observed, there were lots of factors involved in the decisions, and gender didn't ever seem to be an important factor.

    It seems that the strongest argument for gender discrimination is inequality of outcomes.  Men make more than women.  So is life not working out when outcomes differ?  This is similar to the thinking that we need to re-distribute earnings from those who are more successful, because it just isn't fair that they earn more?  By whose definition is this forced equality of outcomes fair?  And where do you draw the line?

    Let's not fall into the victimization mentality.  Let's really study not just the salaries, but dig into the real reasons for the differences.  It might surprise us to learn that it's actually working out rather better than we thought.


    I am not arguing - and most women I know would not argue - for a default victimization position. I am simply saying that while we may find litigiousness to be distasteful, it is not fair to argue that anyone who claims to have been discriminated against is playing the victim card, or is a troublemaker, or is simply looking for a legal remedy to a situation they could not correct through harder work and greater dedication.

    And may I gently suggest that just because you have not experienced or seen actual cases of gender discrimination is not by itself proof that it does not exist.
    KC's View:

    Published on: October 2, 2012

    In Monday Night Football, the Chicago Bears defeated the Dallas Cowboys 34-18.
    KC's View: