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    Published on: October 12, 2012

    by Kevin Coupe

    This is the kind of story I'd only post on Friday. But definitely, because it appeals to my sense of the absurd.

    Forbes reports on a new paper in the New England Journal of Medicine saying that there is "a highly significant correlation between a nation’s per capita chocolate consumption and the rate at which its citizens win Nobel Prizes." According to the story, "there is a close, significant linear correlation between chocolate consumption per capita and the number of Nobel laureates per 10 million persons in a total of 23 countries."

    Sounds like a branding opportunity is in there somewhere....

    Nobel chocolate. It doesn't take brains to choose it.
    KC's View:

    Published on: October 12, 2012

    The Los Angeles Times reports that a new survey done by the Pepperdine University School of Public Policy and the California Business Roundtable suggests that support is dropping for Proposition 37, the referendum being voted on in just a few weeks that would mandate the labeling of foods that contain genetically modified ingredients.

    The new poll suggests that support for the labeling mandate has dropped in just two weeks from 66.9 percent to 48.3 percent, while opposition has gone from 22.3 percent to 40.2 percent.
    KC's View:
    No real surprise here, since, as the Times notes, the "drop in support for the measure parallels the unleashing by opponents of a multimillion-dollar television advertising campaign."

    These days, I almost care less about the issues than I do about the ability of big money to sway an election one way or the other.

    If the proposition passes, I hope there is the facility to amend it in a way that makes it less onerous for retailers and puts the majority of responsibility on manufacturers and reduces the ability of trial lawyers to turn this into a gold mine. And if it fails, I hope food industry leaders are smart and prescient enough to embrace a measured and sensible national approach to GMO labeling that faces a simple reality - transparency is the only responsible policy going forward.

    Published on: October 12, 2012

    Reuters reports that Amazon founder/CEO Jeff Bezos told the BBC in an interview yesterday that the various iterations of its Kindle tablet/e-reader is essentially being sold "at cost," with Amazon making its money on the sale of content.

    While many analysts have speculated that this has been the case, it is said to be the first time that Bezos has confirmed the pricing strategy.

    The story notes that the Amazon approach is different from that of Apple, which "makes much of its profit from hardware sales. It sells a single-sized iPad at costs ranging from $399 to $829, depending on storage capacity, screen resolution and wireless connectivity."

    The Bezos approach to content and competition, by the way, also is illustrated by a story this morning in USA Today, which reports that Amazon is putting a lot of pressure on Netflix by "steadily boosting the menu of streaming movies and TV shows it offers its Prime subscribers for $79 a year. The online retail giant last month bumped up the number of titles in its video library that can be streamed to more than 25,000, sending shares of Netflix tumbling 6% the day it was announced ... The universe of streamed video on the Internet has vastly expanded, with a horde of new contenders entering the fray since the dawn of Netflix's business in 1997. What has become an exciting chapter for home video fans will likely be a pivotal period for Netflix, which does not disclose the number of videos it streams."
    KC's View:
    There are so many lessons here, but let me focus on what I think is the most important one - Amazon's willingness to abandon businesses that some might define as a core value.

    Think about it. Amazon began selling hardcover and paperback books. But now, because the world has changed, Amazon probably would be fine if it never, ever sold another physical book. And it is willing to sell Kindles at cost to move as much content consumption as possible to the e-world.

    It is still selling books. But it is happy to change horses whenever the culture and technology make it advisable to do so. It is happy to embrace change - even encourage and instigate change - because, as it says in the commercial, "normal just begs to be messed with."

    Published on: October 12, 2012

    Marketing Daily reports on a new trend called "The New Healthful" by the Culinary Trend Mapping Report - a trend that focuses less on being healthy by avoiding or cutting down on certain foods and beverages, and more on consuming "foods and beverages that are inherently nutritious or offer nutrition benefits."

    The report, according to Marketing Daily, "recommends that food makers and restaurants recognize that the demand for 'flexitarian' foods that offer protein as well as good taste and texture will continue to grow -- as will the need for ingredient transparency. Among other implications, this means that food providers should be setting up new supply lines for healthful, raw ingredients."
    KC's View:
    Always best to emphasize the positive ... or, as they say in the song, look on the bright side of life." This sounds vaguely like some trend invented by a consultant looking to score a few new gigs ... but that doesn't mean it doesn't make a certain sense.

    Published on: October 12, 2012

    Reuters reports that Walmart is offering its US employees and their families "free heart and spine surgeries at six major health centers at no cost to the retailer's workers, as it tries to find better ways to cover costly, complicated procedures ... Wal-Mart anticipates that the program will help reduce its costs as it receives bundled pricing from the healthcare organizations, but it cannot project the amount it might save ... Wal-Mart's announcement marks the first time that a retailer has offered a national program for coverage of heart, spine and transplant surgery, though some other companies already offer similar programs on a smaller scale."

    According to the story, "The six healthcare organizations include those that have won high marks in terms of patient care and keeping unnecessary costs at bay: Cleveland Clinic in Cleveland, Ohio; Geisinger Medical Center in Danville, Pennsylvania; Mayo Clinic sites in Minnesota, Arizona and Florida; Mercy Hospital Springfield in Springfield, Missouri; Scott & White Memorial Hospital in Temple, Texas; and Virginia Mason Medical Center in Seattle, Washington."
    KC's View:

    Published on: October 12, 2012

    Reuters reports that JC Penney has just done something that its new CEO, Ron Johnson, swore he'd never do as he attempted to wean customers off the steady diet of price promotions and coupons that the company had force-fed shoppers over the years.

    It has sent its customers a $10 gift certificate, good for an in-store purchase until November 4.

    Or, in other words, a $10 coupon.

    In an accompanying letter to shoppers, Johnson says that the coupon/certificate is a way of thanking people for their loyalty.

    Since embarking on its new strategy, JC Penney's sales and traffic have been plummeting, increasing the pressure on Johnson to find ways to turn the troubled retailer around faster.
    KC's View:
    A coupon by any other name still smells as sweet. And spends as easily.

    In the long run, from a philosophical point of view, I believe that Johnson's is the absolutely right approach. For many customers, the barrage of coupons and sales offered by JC Penney were like heroin ... people constantly needed their next fix. And in launching this ongoing barrage, JC Penney was essentially reducing its value proposition, saying that its products were only worth buying when on sale, and if you don't like the sales today, just wait 24 hours.

    But like getting off heroin, sometimes cold turkey is the hardest way to go. So maybe we can think of this $10 certificate as a kind of methadone.

    One thing ... there are a lot of retailers who should learn this lesson. You keep cheapening the value proposition, and eventually you create the impression that you have few values and perhaps less value.

    Published on: October 12, 2012

    Bloomberg reports that Kraft Foods Group is looking to sell the Breakstone business, a move that it hopes could bring it in the neighborhood of $400 million. The story notes that the sour cream and cottage cheese business is not the only one likely to be divested by Kraft, as it looks to sell "smaller brands" and focus on its top-selling labels.

    • The Associated Press reports that Safeway "is betting that its investment in a new customer loyalty program will eventually pay off, as the supermarket operator looks to fend off big-box retailers and other competitors that are expanding their grocery aisles." Safeway said yesterday that its new "Just for U" program "continued to eat into its profit margins in the third quarter. But the program is already showing signs of boosting results, Safeway said, with its market share up and sales in the current quarter running up 1 percent."

    • The Orlando Sentinel reports that Publix is expanding the "test of an online deli ordering system to 50 stores around Georgia and Florida – but not in Orlando." The system - which allows people to avoid lines by ordering via their computers or mobile devices - is seen as yet another way for Publix to test out online marketing options.

    The Los Angeles Times reports that TC Global, parent coffee of Tully's Coffee, has filed for Chapter 11 bankruptcy protection, saying that "“significant challenges that were preventing the company from being profitable."

    The company said it plans to close a number of its 175 stores and emerge from bankruptcy sometime next year.

    Reuters reports that the US Postal Service (USPS) said yesterday that the cost of mailing a first class letter will go up by a penny to 46 cents on January 27. The last time the cost of a stamp went up, by a penny, was last January.

    The story notes that the USPS also will begin selling "a new, global Forever stamp starting next year, which customers can use to send letters anywhere in the world for a set price of $1.10."
    KC's View:

    Published on: October 12, 2012

    ...will return.
    KC's View:

    Published on: October 12, 2012

    • In Thursday Night Football action, the Tennessee Titans defeated the Pittsburgh Steelers 26-23.

    • In the American League Divisional playoffs, the Baltimore Orioles defeated the New York Yankees 2-1 in a 13-inning game, tying their best-of-five series at 2-2 and sending the two teams to a final and deciding game that will take place at 5 pm EDT tonight.

    Also in the American League, the Detroit Tigers defeated the Oakland Athletics 6-0 in their fifth and deciding game, which send the Tigers to the AL Championship Series, where they will play either the Yankees or the Orioles.

    • Over in the National League, the Washington Nationals defeated the St. Louis Cardinals 1-0 ... the two teams are tied 2-2, and will play their deciding game 5 at 8:30 pm EDT tonight.

    And, the San Francisco Giants defeated the Cincinnati Reds 6-4, taking the series 3-2 and sending the Giants to the NL Championship Series.
    KC's View:
    I don't really have a horse in this race, since the Mets have been yet again sent packing.

    I have some new friends in Detroit, with whom I went to a Tigers game a couple of weeks ago, and I'm happy for them that their team have moved to the next round. I wasn't rooting against the A's, though, because I'm a "Moneyball" fan.

    I think the Nationals are a great story and I have a Mets fan's affection for Davey Johnson, so I'm good with them ... but I also like the Cardinals, mostly because of Joanie Taylor, who is one of the best people on the planet.

    I was okay with the Reds, mostly because I've had some great times at Great American Ballpark (including one memorable game with my son when he was going to school in Ohio), and I have real affection for the Giants because of their New York roots, because my dad rooted for them when I was growing up, because San Francisco is one of the world's greatest cities and AT&T Park is one of my favorite baseball stadiums. (I've been to all but five ... and my record would be better if some teams hadn't built new ones.)

    And I like the Orioles because they have Camden Yards and Cal Ripken Jr. In fact, there is only one playoff team against which I am actively rooting. It isn't that I am a Yankee hater - I admire people like Jeter and Girardi, and really admire the way the organization works. (I wish the Mets were less dysfunctional and a little moire Yankee-like.) But it hard for me to root for any team with so many championships and so much money to spend ... I just think it is healthy for the wealth to be spread around a little bit.

    Published on: October 12, 2012

    A bunch of movies to recommend this week...

    I loved Looper. It is a fascinating puzzle box of a movie, about a hit man who kills people who have been sent back in time from a future 30 years hence. Joseph Gordon-Levitt plays the killer, who has to deal with a conundrum when he has to kill himself, played by an older, balder Bruce Willis. The casting conceit works, the time travel element plays well because they don't overdo the whole space-time continuum paradox stuff, and there are real philosophical underpinnings in the movie, which considers the whole notion of consequences and culpability. There are even some good business lessons in the movie ... many executives make decisions based on short-term needs, but it can be an important exercise to think about what the implications will be on a brand and an infrastructure in 10, 20, 30 years. Terrific movie, and beyond the entertainment value, it is actually about something.

    Taken 2 is a sequel to the surprise hit Taken, in which Liam Neeson played a retired CIA agent who goes to Paris to rescue his teenaged daughter, who has been kidnapped by human traffickers. Perhaps a sequel was inevitable; this time, it is Neeson's character and his ex-wife who are kidnapped, and the plot has to do with the daughter helping Neeson escape and vanquish the bad guys (who are related to the many bad guys he killed in the first one). I can tell you this. Taken 2 is about 90 minutes long, and 70 minutes of it are pure carnage. It ain't much, but I had a good time.

    I had mixed emotions about going to see Trouble with the Curve. I know is is almost blasphemy to say so, but I'm not an enormous fan of Clint Eastwood as a director; I've liked movies like Unforgiven and Million Dollar Baby a lot, but have been less enthusiastic about movies like Midnight in the Garden of Good and Evil and Gran Torino, which I've found to be too flat and uninspired. And I even have reservations about his acting - he's good in some stuff, but especially as he's gotten older (and, admirably, willing to show the limitations and annoyances of age), his acting limits have become evident. But, if I don't always admire the work, I am enormously impressed by the work ethic - we should all be so productive and ambitious when we're in our eighties.

    So I went to Trouble with the Curve because I felt I should, not because I really wanted to. The direction was even, bordering on flat. (Robert Lorenz directed, not Eastwood, but his long apprenticeship under Eastwood is evident.) The writing is unsurprising. And yet, as the movie went along, I found myself being touched by some wonderful performances - Eastwood as Gus, an aging baseball scout who is slowly losing his sight but none of his pride, and the always fabulous Amy Adams, as his career-minded daughter who find herself going head-to-head and finally heart-to-heart with the old curmudgeon. The rest of the casting - with people like Justin Timberlake, John Goodman, Matthew Lillard, Robert Patrick and many more, some of whom you will recognize and some you won't - is terrific, even occasionally inspired. The movie got me, unexpectedly. And I'm glad.

    End of Watch is another movie I expected not to like, and the first 15 minutes or so confirmed it for me. The jerky camera moves, the music and the writing just struck me as too much like a video game, and I was shaking my head, wondering why I'd dropped the $11. But then, slowly, the characters (two cops, played by Jake Gyllenhaal and Michael Pena) got under my skin, and I began to root for them, feel for them, admire them. In the end, it is the 2012 version of a buddy movie ... and I really like the serious work that writer/director David Ayer has done here. It may take some time to get used to End of Watch, but it is worth the effort.

    One wine to recommend this week - the 2008 Frank Family Vineyards Zinfandel from Napa, which is great with spicy food. Try it, and thank me later.

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

    KC's View: