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    Published on: November 21, 2012

    by Kevin Coupe

    Sometimes, it is good for an industry to remember where it came from. And be thankful.

    Once a year, since 1996, at the annual Food Marketing Institute (FMI) Midwinter Executive Conference, there would be a picture taken of a bunch of guys with gray or white hair. It was always at one of the conference breakfasts, and it was a whimsical little moment engineered by Paul Corliss, who was a pioneer in the card marketing business. "The Silver Fox Club," he called it - and it was his notion of a kind of in-industry affinity group.

    A lot of industry titans have been in those pictures over the years. People like Fred Meijer, Mark Hollis, Dean Werries,  Bob Tobin, Neil Golub, Jim Moody, Hugh Phillips, Rick Tilton, Rich Neiman, Bill Macaloney, Jim Keller, and, of course, Corliss. (You can see some of those faces in the picture accompanying this story, which was taken in 1996.)

    Now, to be honest, I wasn't always supportive of the Silver Fox Club. Maybe it was the idea that my own hair was getting gray, and I didn't want to to be part of any club that would have someone like me as a member. A few years ago, here on MNB, I gently suggested that perhaps it reflected a certain reverence for the past in an industry that needed to be better about embracing the future.

    Last week, however, I got an email from Paul Corliss (who had a good sense of humor about my chiding), noting that the last meeting of the Silver Fox Club took place last January, and that at the next FMI Midwinter, the breakfast would not feature that gathering of aging executives. And I have to admit that I was saddened by that. Maybe I was a bit of a wisenheimer in my previous remarks. Because while I was right that the industry needs to be better about embracing the future, there is nothing wrong with recognizing the foundation upon which it all has been built.

    So look at the faces in the picture. They are the foundation.

    And be thankful that they came before, making everything else possible.
    KC's View:

    Published on: November 21, 2012

    The this morning reports that Our Walmart, the union-backed group of Walmart employees that has been threatening a series of Black Friday protests against the company, has filed a complaint against the retailer with the National Labor Relations Board (NLRB).

    The move follows Walmart's own filing against Our Walmart with the NLRB, which accused the group of trying to precipitate an illegal strike against the company. The NLRB is not expected to rule on this grievance until after the holiday.

    The OUR Walmart complaint says that a statement by a Walmart spokesman - that "there would be consequences" if employees don't show up for work on Friday - "constituted an illegal threat meant to discourage workers from exercising their federally protected right to protest."

    According to the story, "Wal-Mart maintains that OUR Walmart’s rolling protests have continued for more than 30 days and are actually sponsored by the United Food and Commercial Workers International Union, which helped found OUR Walmart last year. Wal-Mart contends that the food and commercial workers are seeking union recognition from the company.

    "But OUR Walmart and the union maintain that OUR Walmart is an independent group that no longer relies on the union for support. Further, they argue that the hundreds of protests that they say will take place this week are not seeking union recognition, but are protesting what they say is Wal-Mart’s retaliation against workers who speak out about wages and working conditions."
    KC's View:
    Maybe I'm just getting cynical in my old age, but I have trouble believing the whole "OUR Walmart has nothing to do with the union" argument.

    Give me a break.

    And while I know people have a right to protest, I am sympathetic to Walmart's concerns about being hit with a strike on one of the busiest days of the year.

    Published on: November 21, 2012

    The Chicago Tribune writes that a last ditch effort to find a mediated settlement has failed, with Hostess Brands and the Bakery, Confectionary, Tobacco and Grain Millers Union unable to reach any sort of agreement that would keep the company in business.

    Hostess, which is in its second bankruptcy in less than a decade, had gone to the judge overseeing its affairs and asked to be allowed to liquidate its brands and infrastructure because of an inability to conduct business because of the ongoing labor dispute and a strike that began earlier this month. The judge said that liquidation could not take place until the two sides tried mediation, but now that this effort has failed, Hostess once again wants to sell its assets, including the Twinkies and Wonder Bread brands.
    KC's View:
    No surprise here. At this point, Hostess may be worth more broken up and sold for parts.

    In the end, there will be plenty of blame to go around. I cannot help feeling, though, that part of the problem is that much of the company's business model was antiquated, and that management never gave labor a reason like it had any skin in the game - other than their jobs - to fix things.

    There's got to be a better way to do business.

    Published on: November 21, 2012

    Marketing Daily reports that while there are petitions online that object to retailers opening their doors on Thanksgiving, a new study from Deloitte suggests that they are only giving customers what they want - that "23% of people plan to shop in stores on Thanksgiving Day, an increase from 17% in last year’s survey. And more than one-quarter will shop online."

    The story notes that while "a Target employee has collected more than 350,000 signatures on a petition asking Target to close on Thanksgiving, and a similar petition for Walmart has collected some 30,000 names," experts say that "despite a relatively small group of agitated traditionalists, it just doesn’t make sense for stores to close when competitors will be open, ringing up big sales."
    KC's View:
    I've said it before, and I'll say it again.

    I hate the idea of stores being open on Thanksgiving. I hate the idea of Black Friday bleeding into Thursday. But I get it. In the end, retailers are there to serve customers. And one of the realities of working in retail is that sometimes you have to work when other people don't.

    Published on: November 21, 2012

    Ad Week reports that a study from Harris Interactive Digitas says that 28 percent of adult smartphone and tablet computer owners "plan to shop using those mobile devices on Thanksgiving Day ... almost double the 15 percent of U.S. adults age 18 and older who made the same claim in 2011."

    “The fact that it’s just about a 100 percent year-over-year increase shows the big behavioral change that mobile devices are causing,” Chia Chen, mobile lead at Digitas, tells Ad Week . “Mobile is not just a channel—it’s really about this kind of technology-driven cultural change.”
    KC's View:
    Just another example of how the world is changing ... and why retailers have to adapt to these changes, even if that means opening on Thanksgiving.

    Especially because, as the story notes, "according to a Pew Research poll conducted this summer, 45 percent of American adults (age 18 and older) own smartphones. The percentage is significantly higher among young adults and affluent adults, the study found. 66 percent of adults age 18-29 own smartphones, as do 68 percent of adults in households earning more than $75,000."

    It is like what Willie Sutton supposedly said about why he robbed banks - that's where the money is.

    Published on: November 21, 2012

    Reuters reports this morning that "the worst U.S. drought in more than half a century has weakened the safety net for the 50 million Americans who struggle to get enough to eat, and the nation's food banks are raising the alarm as the holiday season gets into full swing."

    According to the story, "This summer's crop-damaging weather in the U.S. farm belt has driven up costs for everything from grain to beef. That means higher prices at the grocery store, but it also means the U.S. government has less need to buy key staples like meat, peanut butter, rice and canned fruits and vegetables to support agricultural prices and remove surpluses.

    "Most of the products from those government purchases are sent to U.S. food banks, which then distribute them to food pantries, soup kitchens and emergency shelters that are a lifeline for people who struggle with hunger - including low-income families, senior citizens and people with disabilities. The decline in government donations is exacerbating the pain inflicted by stubbornly high unemployment and a lack of income growth for many low-wage workers."
    KC's View:
    Worth thinking about as we go into the Thanksgiving holiday.

    Some people are worried about feeding their kids.

    And others, at least according to our next story, worry about a $180 million tax bill.

    I'm not suggesting that the latter isn't worthy of attention. Just that maybe in a country where a lot of people go hungry, it is hard to work up too much sympathy for certain people in certain situations.

    Published on: November 21, 2012

    • The New York Times reports that Walmart will "pay out its quarterly dividend on Dec. 27 instead of Jan. 2, as was scheduled," which could save the Walton family as much as $180 million in federal taxes.

    According to the story, "The change will allow the family and other Wal-Mart shareholders to record the income this year, when the federal tax rate on dividends tops out at 15 percent. Next year, if the Obama administration and Republicans are unable to reach a compromise, that rate is set to jump sharply to 39.6 percent. High earners will have to pay an additional 3.8 percent on most investment income to help pay for the new federal health care law, bringing the total possible tax bite to 43.4 percent."

    And, the Times notes, "Even if a compromise is reached and taxes do not rise quite as high as scheduled next year, investors and companies of all sorts appear to be betting that tax rates will be higher next year."

    The story says that under current tax law, with dividends being taxed at 15 percent, the Walton family would owe the federal government about $95.4 million. If the law changes, and the tax on dividends returns to pre-Bush tax cut rates, the family's tax bill could be in the $276 million range.

    The Waltons own 48 percent of Walmart stock.

    • The Los Angeles Times reports that Los Angeles County Superior Court Judge James C. Chalfant has refused to issue an injunction that would have stopped Walmart from proceeding with the building of a supermarket in the city's Chinatown neighborhood.

    Community activists have opposed the building of the store, saying that it will affect the makeup of the neighborhood, and union organizers have opposed it because of the retailer's long antipathy towards organized labor. However, the judge said that project opponents have to wait to see what happens with an administrative appeal filed with the city, saying that Walmart should never have been issued building permits.

    While it seems likely that the appeals process could be drawn out until mid-2013, by which point Walmart will have completed and opened the store, the judge also said that Walmart was risking the possibility that it could be ordered to tear down the store if a final judgement goes against it. "If the law says they have to tear it out, they have to tear it out," Chalfant said. "The fact that they are pretty far along doesn’t amount to much."
    KC's View:

    Published on: November 21, 2012

    Internet Retailer reports that has come up with a new way to personalize gift cards, by adding video that can include photos provided by the giver.

    According to the story, "Amazon Video Gift Cards are structured around videos from digital media and online entertainment company JibJab. Gift givers via can select from a variety of brief 'JibJab Starring You' videos," that include "such scenarios as an elf snowball fight, German polka, a hair-metal rock performance, disco Christmas and something called The Buttcracker, apparently a parody of the famous two-act holiday ballet. A consumer uploads a photo to the Amazon site to personalize the videos—for instance, putting his own or the recipient’s mug below the exploding black hair of the rock guitarist—before specifying the amount of the card."
    KC's View:

    Published on: November 21, 2012

    • IGA has announced a donation of more than $265,000 to Wounded Warrior Project (WWP) as a result of the second annual IGA Exclusive Brand national marketing initiative that ran in participating IGA stores from Memorial Day weekend through Labor Day weekend of 2012.
    During the promotional period, IGA donated a portion of the proceeds from the sale of IGA Exclusive Brand water, hotdog and hamburger buns featuring specially marked WWP packaging, resulting in more than $171,000 of the donation. Kraft contributed in IGA’s name an additional $50,000 donated in exchange for the positioning of beverage mix displays featuring Crystal Light, Kool-Aid, Country Time and MiO liquid water enhancers in IGA stores during the promotional period. IGA retailers’ own fundraising efforts and the IGA WWP Golf Tournament held in the summer of 2012 made up for the remaining amount of nearly $45,000. This is an increase of more than $145,000 dollars from the $120,000 donation made in 2011.

    • ShopRite announced that its Selden, NY, store has been awarded the GreenChill Silver Certification. This award, distributed by the Environmental Protection Agency (EPA), recognizes food retailers who have implemented sustainable cooling systems, thereby reducing refrigerant emissions and decreasing their impact on the ozone layer and climate change. The ShopRite of Selden is one of 52 national recipients of the Silver Certification and the first on Long Island to receive this distinction. 
    KC's View:

    Published on: November 21, 2012

    • Kim Jeffrey, president/CEO of Nestle Waters North America, reportedly will step down from that role after two decades and become non-executive chairman of the company. He will be succeeded by Tim Brown, president/.CEO of Nestle Canada.
    KC's View:

    Published on: November 21, 2012

    ...will return.
    KC's View:

    Published on: November 21, 2012

    Here's what I kept thinking as I watched Lincoln, the new Steven Spielberg movie about the 16th president:

    In 1865, Washington sure seems cold and dark.

    The thing is, most of Lincoln takes place indoors, and all of the light comes from windows or fireplaces. And everybody seems to be wrapped in shawls, as they gird themselves against the chill. (It reminded me of growing up, since I had a father who was forever turning off the lights and turning down the hat.)

    With the exception of two scenes - a Civil War battle at the beginning of the movie, and a scene where Lincoln surveys the awful human detritus of a battle toward the end of the film - Spielberg and his screenwriter, Tony Kushner, avoid the impulse to go epic in this treatment of our greatest president. They keep the movie small, and focused on just a few months toward the end of the president's life, as he actually delays the end of the Civil War in order to get the Congress to approve the 13 Amendment, abolishing slavery.

    In doing so, they turn Lincoln into a kind of political thriller, and rather than turn the central character into a larger-than-life icon, they - and Daniel Day-Lewis, inhabiting rather than just acting the role - create a nuanced and approachable portrait of a most unusual man, and surround him with a cast of actors that bring the scenario and the historical figures to compelling life.

    In the end, most of the light and heat in Lincoln is provided by great acting persuasive and literate writing, and the sure direction of one of our best directors. You can't do much better than that.

    One of the questions I usually get at this time of year is this: What wines are you serving at Thanksgiving?


    In part because they are wonderful, and in part because they come from the part of the country that I love the most, and in part because they are made by people I have met and like very much, we'll be serving the 2009 Willamette Valley Vineyards Pinot Noir and the 2009 Roads End Pinot Noir from Carlton Cellars - both among the best pinots that Oregon has to offer.

    Somehow that seems appropriate, since one of the things I am most thankful for this year is the opportunity that Portland State University and Professor Tom Gillpatrick gave me last summer, to spend a month there team-teaching a class. It was a life-changing experience, and I'm grateful.
    KC's View:

    Published on: November 21, 2012

    This is Thanksgiving weekend here in the US, which I always think is the best holiday of the year because it brings families together without the pressure of presents and expectations. There’s just food and football and fellowship - all good things.In keeping with tradition, MNB will be on hiatus for a four-day weekend. (The archives, of course, always are open...)

    Have a great holiday ... a great weekend ... and I'll see you Monday, November 26.

    KC's View: