retail news in context, analysis with attitude

Published on: November 13, 2014

This commentary is available as both text and video; enjoy both or either. To see past FaceTime commentaries, go to the MNB Channel on YouTube.

Hi, I'm Kevin Coupe and this is FaceTime with the Content Guy.

Last week, I had the opportunity to travel up to Foxboro, Massachusetts, for a "learning event" hosted by the New England chapter of the Network of Executive Women (NEW). I was lucky enough to be a guest speaker for the conference, but that's not the reason I wanted to talk to you about it.

No, mostly the reason I wanted to bring it up is because of the single word I would use to sum up the attitude that seemed most prevalent among the attendees at the conference.

Joy.

As much as at any conference I've ever attended, the folks from NEW genuinely seem to be happy in their work, to use the phrase uttered by Col. Saito in The Bridge On The River Kwai. There were folks from pretty much every New England food industry company in attendance, and from all levels of their organizations, as well as some college students who are being mentored by NEW members. And while I'm sure that they all suffer some of the same annoyances and encounter some of the same frustrations that we all do, there was something special going on in the room.

I think that's important.

Listen, I know that business - especially these days - is hardball. Or, to use football terminology since the meeting took place in the shadow of Gillette Stadium, where the New England Patriots play, it is full-contact, pads-on tackle … with the winners knowing how to play both offense and defense.

But there also was a sense in the room that they were all on the same team … that by making each other better, they raised the level of the game for the entire industry. That's a critical mindset to have, I think.

A couple of weeks ago, I used this soapbox to rail against the ravings of a crazy person who suggested that women forced to either look for legislative or judicial remedies to seemingly insoluble problems of gender bias were essentially the same as people who sleep their way to the top. I didn't mention it at the time, but this was the same person who, after I reported that Larree Renda was leaving Safeway after it is acquired by Albertsons, suggested that her role as head of the Safeway Foundation was a "make work job" developed to allow Safeway to fill some quotas. (Yes, I know - he's a moron. But if you think he's the only moron out there who thinks this way, you're sadly mistaken.)

I think it is more important to use this soapbox to talk for a moment about how important an organization the Network of Executive Women is … that it contributes something far more important and lasting that just creating a supportive, nurturing networking environment for woman in business. (And men … there were a bunch there beside me, and I think we all felt lucky to be included.)

To me, NEW allows and encourages people to think and see beyond themselves and their own roles in their own companies. It creates an environment in which people can get away from the daily task of putting out fires and thinking short-term, and focus on building something sustainable.

They're trying to see, if I may use the title of one of my favorite books, the big picture.

The bottom line: If you or your company have a chance to engage with NEW, do so. I've done other NEW conferences, and the one in Massachusetts only cemented my feeling that this is a special and smart organization with great heart and soul. And business can always use more of that.

That's what is on my mind this Thursday morning. As always, I want to hear what is on your mind.

Published on: November 13, 2014

by Kevin Coupe

Not sure if you've seen this commercial, but in the event you haven't, I thought it was worth sharing with you.

The company doing the advertising is Sony, and the commercial - dubbed "Script to Screen" - essentially offers a look at the entire entertainment supply chain, and defines Sony's position in that chain.

It is basically an image ad, but a very clever one … and I think it makes a lot of sense, especially because Sony has had its troubles in recent years and often gets cited as a company that missed the moment that was captured by Apple when it introduced the iPod technology that supplanted the once-ubiquitous Walkman.

There's plenty of life left in the Sony brand, this commercial argues. It is an Eye-Opening argument, and persuasive.

Enjoy.

Published on: November 13, 2014

The Detroit Free Press reports that Kellogg's is taking some fire from conservative groups upset with its sponsorship of a gay pride parade in Atlanta and an advertisement that shows Tony the Tiger, the longtime Frosted Flakes character, saying, "Wear your stripes with pride."

The American Family Association posted the ad on its website to call attention to the Kellogg's sponsorship, and the Free Press says that it got responses that were both critical and supportive of the cereal company. ChristianPost writes that Kellogg's "is 'experiencing a backlash from Christian consumers,' and said AFA responded that it wants companies to 'remain neutral' in what it called the 'battle over same-sex marriage'."

Mark King, Kellogg's global head of diversity, says that the company "is firmly committed to diversity and inclusion and puts a tremendous amount of effort toward ensuring equality through our policies, benefits and culture. We are honored to have been named a Top 50 company for Diversity by DiversityInc, and for achieving a perfect score on the Human Rights Campaign's Corporate Equality Index."

The ad said that "At Kellogg, we're an evolving culture that respects and accepts employees' sexual orientation, gender identity and gender expression so that all employees can be authentic and fully engaged."

Published on: November 13, 2014

The Los Angeles Times reports that a new Pew Research Center study says that "Americans overwhelmingly feel they have lost control over their personal information, with a majority concerned about monitoring of their communications by the government and businesses."

According to the story, "Pew’s survey found 91% of adults either agreed or strongly agreed that consumers have lost control over their personal information, while 88% of adults agreed or strongly agreed that it would be 'very difficult to remove inaccurate information about them online'."

The concerns extend to millennials: "32% of respondents 18 to 29 years old said they had asked someone to correct or remove information about them online."

The study was described as focusing "on public perceptions of privacy after Edward Snowden leaked documents disclosing widespread surveillance by the National Security Agency."

Published on: November 13, 2014

Time has a story about how "the largest U.S. retailers have thrown down the gauntlet this year and announced deeper Black Friday weekend discounts than ever over a longer period, as they are desperate not to lose a single penny to the competition during the holiday shopping wars."

Three examples:

• "Wal-Mart Stores, which recently lowered its sales forecast for the year, stirring fears about its holiday prospects, has announced an aggressive program of deals for what is now a full-on Black Friday week."

• "Target is also going all-in with more deals this year. The discount chain, which already held a pre-sale this week, will offer Black Friday deals starting on the preceding Sunday that will last for a week. And it will offer a few items on sale early on the Wednesday before the holiday."

• "Best Buy, to get a leg up on its rivals on a shopping day that is heavy on electronics, will open its stores at 5 p.m. on Thanksgiving with Black Friday deals. Its stores will remain open until 1 a.m., then re-open at 8 a.m. It will also hold an online-only “doorbuster” sale on Thanksgiving."

Published on: November 13, 2014

The New York Times this morning that Samuel Zell, described as "the Chicago real estate mogul," is one of three bidders for more than 100 stores that Albertsons has to sell in order to alleviate antitrust issues connected to its acquisition of Safeway.

According to the story, "The group backed by Mr. Zell also includes Stuart Sloan, a longtime retail executive who was the chairman of the supermarket chain Quality Food Centers, said the people, who insisted on anonymity to discuss confidential negotiations.

"Another bidder is Oaktree Capital Management, the private equity and debt-investing firm in Los Angeles, two of the people said. The third is Comvest Partners, a firm based in West Palm Beach, Fla., that makes equity and debt investments, according to these people."

The Times story notes that "Mr. Zell has relatively little experience in the grocery business. A billionaire whose taste for distressed assets once earned him the nickname “the grave dancer,” he is best known for headline-grabbing real estate deals, including a $39 billion sale of a commercial real estate landlord to the Blackstone Group in 2007. Mr. Zell is also known for his ill-fated and debt-laden purchase of the Tribune Company, which ended up in bankruptcy."

Published on: November 13, 2014

Fast Company reports that Chobani, the Greek yogurt company that has capitalized on the trend and become a multi-billion dollar company is "opening a food incubator in New York City. If you're unsure what a food incubator is exactly, it's kind of like its tech-world cousin, a Y Combinator but for ambitious food businesses looking to scale."

The story says that "if your food startup is one of the 10-or-so selected when the company starts taking pitches in December … Chobani will provide your business with test kitchens, office space, mentorship, and access to the company's resources like chefs and businesspeople to help you get you off the ground and running."

Hamdi Ulukaya, Chobani's CEO, says that the chosen products will satisfy four criteria: "Number one it has to be delicious. It has to natural. It has to be nutritious. And it has to be accessible."

Published on: November 13, 2014

• Interesting piece on National Public Radio's Marketplace about what people are likely to do with the money they are saving now that gasoline prices are (at least temporarily) falling. It ends up that one of the things that they do is go out and buy trucks and SUVs, especially if they "ditched their gas guzzlers in 2008, when the economy tanked and gas prices spiked."

The story notes that people make this shift even if the economics don't make sense - there comes a point when they buy with their hearts and not with their minds, and will buy trucks rather than that hybrids - just because that's really what they want.


• Delhaize-owned Food Lion announced that it has "unveiled a new, easier shopping experience for customers in 45 stores in the greater Greenville, New Bern and Jacksonville, N.C., market. The stores have received remodels as part of the grocer's 'Easy, Fresh and Affordable…You Can Count on Food Lion Every Day' strategy," which includes an expanded SKU count in grocery, meat and produce.


• The Associated Press reports that Monsanto has agreed to "pay $2.4 million to settle a dispute with farmers in the Pacific Northwest over genetically modified wheat. The discovery of the altered wheat in Oregon in 2013 prompted Japan and South Korea to temporarily suspend some orders, and the European Union called for more rigorous testing of shipments. No engineered wheat has been approved for United States farming. Monsanto will put $2.1 million into a fund to pay farmers in Washington, Oregon and Idaho who sold soft white wheat between May 30 and Nov. 30 last year. It also will make payments to several regional growers associations."

Published on: November 13, 2014

• Bob Craves, who co-founded Costco with Jim Sinegal and Jeffrey Brotman in 1983 and helped grow it from a single Seattle store to a chain that now generates more than $100 billion a year in sales, has passed away from cancer. He was 72.

Published on: November 13, 2014

MNB took note the other day of a New York Times report that the US Department of Agriculture (USDA) has approved for commercial planting "a potato genetically engineered to reduce the amounts of a potentially harmful ingredient in French fries and potato chips … The potato’s DNA has been altered so that less of a chemical called acrylamide, which is suspected of causing cancer in people, is produced when the potato is fried.

"The new potato also resists bruising, a characteristic long sought by potato growers and processors for financial reasons. Potatoes bruised during harvesting, shipping or storage can lose value or become unusable."

The J. R. Simplot Company, which engineered the potato, "calls its product the Innate potato because it does not contain genes from other species like bacteria, as do many biotech crops. Rather, it contains fragments of potato DNA that act to silence four of the potatoes’ own genes involved in the production of certain enzymes. Future crops — the company has already applied for approval of a potato resistant to late blight, the cause of the Irish potato famine — will also have genes from wild potatoes."

I commented:

This is where I get into trouble with MNB readers who are assiduously anti-GMOs. Because I read about this potato engineering, and it is hard for me to identify negatives. I'm sure there are some, and I'm just not scientifically savvy enough to find them.

But generally, this doesn't seem like such a bad idea.

MNB user Ken Wagar wrote:

I appreciated your comments today about the proposed GMO potato. It seems to me that part of the problem with the whole GMO debate is that, like the current political climate, so many people deal in absolutes. It is always or never, good or bad, or black and white with no room in between. This came to mind also around the discussion of Chinese chicken sales in the US. Would we rather have items produced in the USA with GMOs and antibiotics or have items produced in China, Brazil, Peru, Thailand etc. over which we have limited if any control or knowledge? The greater extent to which we eliminate GMOs and antibiotic use in the US the greater the need for imports from other countries will be needed. I'm not suggesting that one is better than the other but that the answers are complex and deserve more study and analysis rather than the simple answers we often come up with.

It makes me wonder about items like Seafood and Produce much of which we already import from places where we have limited if any oversight. To avoid eating meat or any grain based product that may contain GMOs or antibiotics I will eat more seafood like Tilapia and a growing percentage of shrimp which are farm raised overseas and contain only God knows what?

I think we need a more reasonable discussion, more risk analysis, more risk/benefit work and yes more transparency. We also need to be sure we can at the very least feed everyone in the US if not the world.

Sometimes things just aren't as simple as many folks would like them to be.

But another MNB reader wrote:

Hard to find anything wrong with this…we all need more French fries…definitely a vertical gene-splicing concept rather than horizontal gene-splicing…however, anytime you insert genes into a genome, two things happen, 1) the insertion process creates collateral damage to the potato genome creating dead proteins called rubble (nothing is known how this rubble impacts the genome, and, 2) Nothing is known about how the altered plant genome reacts over time and how that reaction impacts the health of the planet & individuals consuming it.




Regarding our story about how lawyers are lining up clients to sue Tesco over its accounting scandal, one MNB user wrote:

My comment has nothing to do with Tesco per se; it is instead focused on the multiple law firms you highlight as looking for plaintiffs to join lawsuits.  IMHO I'd suggest that sums up what is wrong with the legal system - shouldn't we have plaintiffs who are looking for lawyers to help them file a suit, rather than lawyers filing a suit and then looking for plaintiffs?



Responding to our story about how Dunkin' Donuts and Starbucks are developing dinnertime menu items, MNB reader Kim Marsh wrote:

This is my first letter to you as a long time reader.  

One has only to look to the north, Tim Horton's in Canada,  to see that a varied menu, along with focus on quality and value, can keep customers coming in all day long.  As an American living in Canada, I was initially amazed at the traffic, all throughout the day at 'Tim's'.  Granted their strategic moves, like sharing space with Cold Stone Creamery or Wendy's, drove some of that traffic, the reality is that a very high concentration of Canadians go out of their way to stop in Tim's at least once a day and for many, more then once.  

The trick for Dunkin Donuts and others is to find the right balance of value and quality food.  It won't work if they resort to serving slime burgers, the US simply has too many of those options already.




We had a story the other day about how Sears is considering selling its real estate and leasing back its stores as a way of finding firmer financial footing. MNB reader Andy Casey observed:

Does anyone really think the problems at Sears have anything to do with whether they own or lease their stores?  Short term relief, at best.




On another subject, MNB reader Jill M. LeBrasseur wrote:

I just had to write in to comment on your story about the Massachusetts town that’s considering a tobacco ban. Where I grew up there was a town very nearby that was ”dry” meaning they did not allow the sale of alcohol within their city limits. Alcohol is also a legal product. If Belpre, OH can keep alcohol sales out, I see no reason why Westminster,  MA can’t ban tobacco. I would rather live in a town without tobacco than one without wine though.

From another reader:

Call me crazy but to ban tobacco in one city or state while legalizing marijuana in another seems inconsistent with logic and with the overall health goals of our nation.  Am I to simple to think that inhaling tobacco smoke has similar health issues as marijuana smoke? Could one be so harmless and the other so deadly?  You must admit that we American’s have a tendency to be consistently inconsistent.




On the subject of Walmart trying to improve its food sales, MNB reader Rick Nelson wrote:

I recently shopped a recent Wal-Mart conversion store in New England.  I was reminded why I almost never shop for Food at Wal-Mart.  In the produce department,  the black plastic crates used for displaying the produce were mostly empty and littered with wilted leaves/produce.  The variety was poor and no one could be found in the department.  Grocery had a tremendous amount  of OOS  and variety was limited.  The one employee I spoke to about an OOS item, gave me the standard answer that the store is stocked at night and should be available tomorrow morning.  Keep in mind this was the second week the store was open as a Super Center, not the impression I would want for someone who might be shopping there for the first time.