retail news in context, analysis with attitude

Yesterday, MNB took note of a Minneapolis / St. Paul Business Journal report that General Mills chairman/CEO Ken Powell has "restated his opposition to mandatory labeling of genetically modified organisms, commonly called GMOs, at a conference in California Tuesday ... Powell said GMOs are safe and they're part of a solution to feeding the world's growing population."

MNB reader Andy Casey responded:

This amazes me not because I disagree with Powell’s position but because this ship has so clearly set sail already.  As Kenny Rogers sang, “you got know when to fold them …” and this discussion has reached that point.  The best he can possibly achieve now is to shape how it will be implemented and continuing to argue against labeling just makes him seem out of touch at best, or hiding something at the worst.


Another MNB user wrote:

How ironic that you began MNB with a discussion on truth and transparency and then later shared the General Mills CEO’s restated opposition to transparency in GMO labeling.

I’m not sure how anyone else feels but a company that is fighting to NOT tell me what goes into their products is basically saying they do not want my business.

I’m not interested in eating genetically modified products and apparently General Mills knows that…otherwise I am sure they would be clamoring to tell me how genetically modified products are so good for me and slapping it on every box they print…Now back to my frosted flakes!

And another:

It seems to me if labeling a food to contain GMOs is such a bad idea that the food giants have to spend millions to defeat it, those who produce non-GMO food products should establish an organization to validate and certify for “non-GMO” content, because it MUST be a marketing advantage.  Obviously General Mills thinks labeling their foods to have GMO content will have a negative effect on sales, so the opposite should prove true, to have NO GMO labeling must be a positive force for sales.

It seems to work for the Rainforest Initiative and free trade in the coffee business.

We've reported on how troubled retailer JC Penney, desperate to figure out what it has to do to make shoppers love it, has posted a new :30 commercial on YouTube and Facebook that apologizes for its recent marketing missteps. The ad, which features gauzy images of Americans in various settings, has the following voiceover:

It's no secret. Recently JCPenney changed. Some changes you liked and some you didn't, but what matters from mistakes is what we learn. We learned a very simple thing, to listen to you. To hear what you need, to make your life more beautiful. Come back to JCPenney, we heard you. Now, we'd love to see you.

I argued that the ad would have been more effective if it had featured the following voiceover:

Oy. Did we screw up. It ends up that comparing the Apple Store to JC Penney is like comparing apples to manatees. And boy, have we become a retailing manatee. So here's the deal. We're going to send you coupons. And more coupons. We're going to have sales and more sales and more sales. And we'll pretty much do anything to create the illusion that we're relevant. Because America needs JC Penney. And more importantly, we need our jobs.

MNB user Anne Stewart wrote:

LOL...and your ad was so much more with the way advertising is successful today, it certainly would have grabbed my attention because that's how we talk, blog, and text. Penney's recent ad even sounds behind the times, which makes me =(.

Yesterday, I took note of an Advertising Age piece about JetBlue, which it said "jumped into the conversation about Jason Collins with posts on Twitter and Facebook on Tuesday thanking the NBA player for coming out." The Twitter post said, "Thanks Jason, today we're all on the same team."

The issue, Ad Age, was that JetBlue had no connection either to gay rights issues or to Collins, and so could be perceived as exploiting the situation.

I wrote:

It is worth thinking about. Part of the challenge and opportunity of instant communication is knowing what to say and when to say it, not to mention knowing how it will be perceived in the marketplace.

One MNB user wrote:

The cynic in you strikes again...  Before I got to your comment,  I thought to myself, "Cool -- must be more than the average number of LBGT folks at Jet Blue.  Good for them."
Didn't cross my mind at all to think they were capitalizing on an opportunity to get their name out there.

Actually, in this case it was Ad Age being cynical. Still, I think that companies have to be careful not to appear exploitive. I'm not sure if the JetBlue reaction to the Collins situation falls into this category.

Another MNB user wrote:

One of the key points you're missing about JC Penney is not just the pricing strategy... We have stopped shopping there ever since they ran their Mother's day commercials featuring two mom and Fathers day commercials featuring two dads. The Christian community has backed away from retailers like JC Penney, Home Depot and others that outwardly support gay initiatives. Trust me, my family and I are not alone in our boycotts.

I'm sure you're not.

Must be tough not drinking coffee from Starbucks, not ordering products from Amazon, not watching any network or visiting any theme park owned by Disney, not eating Oreos, not buying Microsoft or Apple products, not wearing Levi's, and not shopping at Nordstrom or Target.

It also must be tough knowing that support for gay rights is increasing, and that in many ways, the war is over, though battles remain to be fought.

But hey ... I've always believed that consumers and investors should support companies that reflect their world view, and not patronize those that do not.

On another subject, an MNB user wrote:

In regards to “Walmart Locks and Loads for Battle with Amazon”..

I think the thing Walmart is missing (and will have a hard time achieving) is that it’s fun to shop at Amazon. I don’t shop at Amazon because I’ve had a bad experience in store where I couldn’t find what I was looking for and was forced to go online.

Amazon has almost every product under the sun, with a great amount of reviews. I also have control because I can select who I am purchasing the product from, with the cost and shipping price very clear (I can also pick new or used, which is great when purchasing books). I’m not a Walmart shopper now and would never even think to shop Walmart online. I think their biggest issue will be if people don’t like shopping at the stores, how do you create an online experience so different that they like shopping at Walmart online?

We had a piece the other day about how Graeter's ice cream has decided not to sell to Walmart because the retailer is not seen as being in synch with its brand equity.

My comment:

Once again, it is the Jurassic Park lesson. Just because you can do something does not mean that you should do something.

Graeter's got it right.

If they'd said yes to Walmart, it inevitably would have strained its production capacity. It would have driven prices down. It would have violated the central brand proposition - that this is something special, worth a little more money. And Walmart, which is only interested in its own core brand values, would inevitably would have hurt Graeter's. It would not have ended well for the brand. People would have made some money, but only in the short-term.

Graeter's did not make the same kind of mistake that almost destroyed Krispy Kreme - expanding so fast and with so little concern for core brand values that the company ended up standing for almost nothing.

One MNB user wrote:

I don’t agree with you that Wal-Mart would have driven prices down and violated the central brand proposition created by Graeter’s. If Graeter’s senior leadership allowed Wal-Mart to hurt or dilute their brand, that’s their fault, not Wal-Mart’s. The bigger question is whether or not Wal-Mart is capable of driving prices down and violating brand propositions? The answer is unequivocally yes, but only to those companies that let Wal-Mart do this to their brand. Do you think P&G would lower the quality of Crest or Tide in order to meet price demands from Wal-Mart? Do you think Wal-Mart has violated Remington’s (the gun maker) central brand proposition? I applaud Graeter’s for their position with respect to Wal-Mart, which to me is simple. It’s not worth the fight.

Actually, it sounds like you agree with me more than you disagree with me. But okay...

From another reader:

Good for them. Not many have the courage to say no to the 800 LB gorilla ... Many CPG folks I’ve talked with tell me that they hate being called in by the buyer or management, to be raked over the coals for an ad price that WalMart has seen in the paper from a competitor...

I don't think there is any question that Walmart's traditional way of doing business means constantly asking for lower prices, which often forces manufacturers to compromise their production values. The problem is that Walmart becomes such a big part of their business that they can't afford to say no. It is a vicious cycle, and I think Graeter's decision to protect its brand equity was a wise one.
KC's View: