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    Published on: October 3, 2017

    by Michael Sansolo

    I like my gym. The place is loaded with great equipment, most everything is relatively clean and the trainers have helped me recover well from two different athletic injuries. Simply put, it delivers exactly on what I want from a fitness center.

    However there’s a small problem: my gym clearly wants to be more. The company - Lifetime Fitness - wants to be part of my overall health. The on-site café promises only healthy foods and the monthly magazine is constantly touting solutions.

    And that’s where my enjoyment tends to nose dive with regularity because it’s clear to me that the company has a very specific idea on what healthy is and is not. I may be skeptical, but many of my fellow gym goers wouldn’t agree. Sure the gym only adds to the information overload that shoppers face these days, but like it or not, a fitness center’s point of view can manage to carry a lot of weight.

    It would be easy to argue that Lifetime is getting out of its lane - to use a modern colloquialism - but I’m not sure shoppers see it that way. Rather, they see information from a trusted source they believe and that should concern us.

    Consider the most recent magazine from Lifetime and its take on the eternally controversial issue of GMOs.

    The GMO article read, “As with the first GMOs, some experts are concerned about the lack of oversight, testing or label of these next-gen (GMO products.)” To support that line the article then quoted a single expert, from Friends of the Earth, described as an environmental watchdog group.

    As a believer in balanced journalism, the article offended me for the complete lack of any counter argument. It impossible to believe that the author couldn’t find a second “expert” to both weigh in on GMOs and possibly provide a different opinion. Instead I was left with a clear sense that the author’s entire goal was to support his own point of view.

    Believe me, I understand that GMOs are a controversial issue with a vast gulf between those who support and those who oppose the use of the genetic technology. The gap between general scientific consensus and public opinion is wider on GMOs than a host of other controversial topics including climate change, vaccinations and evolution.

    The reality is that GMOs are both a hot issue and on shoppers’ minds as they wander the aisles of your stores or examine your products. And the information feeding those opinions comes from all kinds of sources, including the gym where they work out.

    So this is where we need to consider the notion of staying in or leaving our own lane. The food industry needs to find a better way to convey credible information on a wide range of topics that impact how our shoppers buy, cook and eat for the simple reason that everyone else is already doing it. On all types of topics, including the controversial like GMOs, we need to be at least part of the conversation.

    After all, this is our lane.

    Michael Sansolo can be reached via email at . His book, “THE BIG PICTURE: Essential Business Lessons From The Movies,” co-authored with Kevin Coupe, is available on Amazon by clicking here. And, his book "Business Rules!" is available from Amazon by clicking here.
    KC's View:

    Published on: October 3, 2017

    by Kevin Coupe

    I thought I was done with this. But then I got the email that you see at left, and it ticked me off all over again.

    The email refers to an announcement that Starbucks made several weeks ago, that is is closing down its online store, and cancelling all subscriptions to coffee held by online customers. This would include me - two pounds of Verona, ground, every month for years. That’s what the email says: now, I have to buy my coffee at the local Starbucks store (or, I supposed, the local supermarket).

    My argument several weeks ago was that this simply doesn’t make sense - Starbucks is setting free people who essentially are captive customers, giving them the opportunity to try other products from other purveyors and retailers. But I had settled in, and was trying to figure out what to do next.

    Then I got this email. And I actually got angrier.

    Because I think this is stupid.







    (Yes, I know I’m obsessing about this a bit. It’s just that I think this is so stupid…)

    That said, I’ve figured out my next coffee move. Blondie Brazil Fazenda Helena coffee from City Girl Coffee of Duluth, Minnesota, a women-owned business that sources coffee only from women-owned farms, donating money to nonprofits that support these women in their countries of origin.

    I now have a subscription. And City Girl has a captive customer. I trust they’ll hold onto me better and longer than Starbucks.

    This lesson should resonate with every retailer. When you have a customer, hold onto that person tight. Nurture the relationship every chance you get. Learn everything you can about that customer, and then act on that information.

    And do whatever you can not to let that customer go.

    That’s what Starbucks did. And it is an Eye-Opener.

    I’m done with this now. (I think.)

    KC's View:

    Published on: October 3, 2017

    Ahold Delhaize-owned Hannaford Supermarkets has announced the launch of “My Hannaford Rewards,” described as “a new program that offers shoppers personalized rewards and special offers on the foods they buy most often.”

    Shoppers will “earn 2% rewards on the purchase of all private brand items,” including meat, seafood, packaged produce, deli items, and center store products. Rewards can be redeemed quarterly, and shoppers will “receive ongoing, personalized coupons.”

    Customers are able to sign up online, or via the new the My Hannaford Rewards mobile app, which allows them to track rewards and redeem offers; to earn and redeem rewards and offers, shoppers can scan their phone or enter their phone number at checkout.

    Hannaford emphasizes that “there’s no tiered pricing as part of this program. Hannaford’s low prices are still available to all of our shoppers - and not exclusively for those who have a My Hannaford Rewards account.”
    KC's View:
    To me, this is an extremely important move by Hannaford - enrolling customers in a program like this means that the company will be able to track - and, more importantly, respond to - customer behavior. I had a chance to chat with company president Mike Vail the other day, and he noted that this wasn’t prompted by the Amazon purchase of Whole Foods, which we agreed is likely to result in Whole Foods doing a much better job of building a loyalty program (likely tethered to Amazon Prime membership); Vail said that this project has been in development for a long time.

    The reality is that retailers need to have as much specific, actionable information about their customers as possible … and then have to act upon it.

    Published on: October 3, 2017

    Bloomberg has a story about new research from Thasos Group, saying that “Whole Foods’ foot traffic from new shoppers jumped 33 percent in the first week following Amazon’s acquisition.”

    In addition, “24 percent of new Whole Foods shoppers were previously loyal Wal-Mart customers, Thasos reported. That same week, 16 percent of first-time visitors used to be regular shoppers at Kroger Co., while 15 percent came from Costco Wholesale Corp., according to the firm, which tracks shoppers who agree to share their location with smartphone apps … Trader Joe’s saw about 10 percent of its regular customers go to Whole Foods, while for Sprouts it was 8 percent, Thasos found. About 3 percent of Target Corp. customers defected.”
    KC's View:
    These numbers, while interesting, have to be kept in context. (As Gabriel Lorca says, “Universal laws are for lackeys. Context is for kings.”)

    We don’t know if these are permanent defections, or just trips of curiosity, prompted by Amazon’s purchase of Whole Foods. We do know that there haven’t been across-the-board price cuts at Whole Foods yet, so we don’t know if the isolated changes had a broad impact.

    There are a lot of moving pieces in this game, but I think the only firm conclusion we can reach is that Amazon’s behavior has the potential of dislodging entrenched consumer behavior. That’s something about which the competition needs to be concerned, though permanent defections are not a foregone conclusion … in the end, the competition has a role in deciding whether or not this happens.

    Published on: October 3, 2017

    The Chicago Tribune reports that Whole Foods plans to open “one of its cheaper, smaller-format 365 stores in suburban Evergreen Park next year and is not abandoning the concept under its new Amazon ownership.”

    According to the story, “The 30,000-square-foot store, announced early last year, was originally scheduled to open in November. But with Amazon’s acquisition of Whole Foods came uncertainty on whether the company would stay committed to the 365 model, which has lower profit margins but could draw shoppers on a tighter budget. The Evergreen Park location would be the first 365 store in the Chicago area.”
    KC's View:
    I actually think that the 365 format will be a great laboratory for Amazon to test various concepts that, if successful, could be applied to its Whole Foods stores.

    Published on: October 3, 2017

    Variety reports that Amazon’s first streaming of “Thursday Night Football” last week “beat Twitter’s numbers from 2016 in terms of average audience size and time spent viewing — but not in total viewers who caught some portion of the game.

    “For the Sept. 28 meeting of the Chicago Bears and Green Bay Packers, Amazon reached 1.6 million worldwide viewers who initiated a stream on Amazon Prime Video, according to the NFL. The average worldwide audience watching ‘Thursday Night Football’ for at least 30 seconds on Amazon Prime Video was 372,000, with each viewer watching an average of 55 minutes.”

    The game also broadcast on CBS and on the NFL Network.
    KC's View:
    This is less about numbers and more about making Prime more robust.

    Published on: October 3, 2017

    Re/code reports that Walmart has acquired Parcel, described as “a Brooklyn, N.Y.-based company that handles scheduled and same-day delivery services in New York for online retailers like Bonobos and meal-kit companies like Chef’d and Martha Stewart’s Martha & Marley Spoon.”

    According to the story, “Parcel will continue to serve those clients, but Walmart will also utilize the startup’s technology and network of delivery employees to ramp up its own same-day delivery offerings for both and in New York City.”
    KC's View:

    Published on: October 3, 2017

    • The Des Moines Register reports that “Hy-Vee plans to expand its new Fast & Fresh convenience store concept to the Shoppes at Prairie Crossing in Altoona, near the soon-to-open outlet mall … the Altoona location could include fuel pumps, a Starbucks coffee shop drive-thru, groceries and a place to pick up online grocery orders.”

    The story says that “the Altoona store could be the first Fast & Fresh store to open in the metro, although a similar store in Davenport could open sooner … The Des Moines and Altoona stores are the only two slated for the Des Moines area, although Hy-Vee is looking to build Fast & Fresh stores in other markets.”

    • The Orlando Sentinel reports that “Publix Super Markets’ strict grooming standards have the clean-cut grocery chain in hot water with federal anti-discrimination authorities. The Equal Employment Opportunity Commission is suing the Lakeland-based grocer, alleging religious discrimination for telling a new hire to cut his dreadlocks to work there.” The person in question is Rastafarian, and does not cut his hair.

    According to the story, “Publix has been criticized in the past for its strict grooming code that requires men to wear clean-cut hairstyles and eschew beards. In 2015, an online petition to allow beards at Publix gathered more than 16,000 supporters, but the facial-hair doctrine remained.”
    KC's View:

    Published on: October 3, 2017

    Tom Petty, one of the nation’s enduring rock stars - he sold millions of albums and had hits that included “Refugee,” “Don’t Come Around Here No More,” “Free Fallin’” and “Into the Great Wide Open” - has passed away at age 66 after suffering cardiac arrest.

    The New York Times obit notes that Petty’s songwriting “was shaped by the music he heard growing up: the ringing folk-rock guitars of the Byrds, the crunch of the Rolling Stones, the caustic insights of Bob Dylan, the melodic turns of the Beatles, the steadfast backbeat of Southern soul and the twang of country-rock … Recording with the Heartbreakers, the band he formed in the mid-1970s, and on his own, Mr. Petty wrote pithy, hardheaded songs that gave a contemporary clarity to 1960s roots. His voice was grainy and unpretty, with a Florida drawl that he proudly displayed … In his 1989 hit, “I Won’t Back Down,” he sang, “You can stand me up at the gates of hell, but I won’t back down.”
    KC's View:

    Published on: October 3, 2017

    Yesterday, MNB reported on the case of John Morgan Campbell, the former H-E-B executive who was instrumental in the development of its Central Market concept, who has been charged with 53 counts of child pornography and is facing up to 600 years in prison if convicted; Campbell is accused of having graphic images and videos of underage boys on work devices.

    I commented:

    Even allowing for the fact that people are innocent until proven guilty, the news coverage suggests that the evidence is overwhelming, and that the defense isn’t denying the existence of the pics on Campbell’s computer - just trying to find legal reasons to mitigate the legal damage to his case.

    It pains me to write this story. I know John Campbell. I’ve spent some time with him looking at stores, taking advantage of his insights. He took me to dinner once when I was in Austin. I found him to be extraordinarily knowledgeable, gifted in his understanding of retail, and extremely charming. I know people who have known him for a long time, people of strong moral character who must now be at an utter loss. It is difficult for me to reconcile the man I knew, if only a little bit, with the man whose portrait is being painted in deep, dark and disturbing colors in a Texas courtroom. I am, in a word, gobsmacked.

    This prompted an email from MNB reader Heather DeLuca:

    I’ve never responded to any comments by KC, but this really is disturbing.  I understand that KC has a bit of a history with Mr. Campbell, but just because he was a nice guy to him doesn’t mean he’s not an evil disgusting human being.  Many people are “nice guys” in front of the masses, but hide deep dark secrets.  He looks at child porn for gods sakes!  He could very well be a child molester and KC brings up all the good things about this guy.  This is why “nice guy” bad people don’t go to jail.  It’s almost as if you are giving him an excuse, why is that?  Oh I forgot it’s because he said nice things to you and gave you some great knowledge, whatever!

    If I in any way appeared to be excusing or explaining Campbell’s behavior with my comments yesterday, I apologize. That certainly was not my intention.

    In fact, I was just trying to communicate the bafflement of finding out that someone I knew appeared to be have committed such horrible acts. We read all the time about people who do terrible things, from holding child porn on their computers to committing mass murder … but it is rare that we actually know the person that did it. This can be hard to reconcile, but that doesn’t mean that there are excuses or explanations. That’s what I was trying to communicate.

    I’ll also say this. I’ve gotten a number of emails about this story from folks who did not want them posted. It is fair to say that there were people who were completely surprised by this, but there also were people who were not surprised at all. Which makes it all even harder to understand.

    But there are no excuses, no explanations.
    KC's View:

    Published on: October 3, 2017

    In Monday Night Football, the Kansas City Chiefs defeated the Washington Redskins 29-20.
    KC's View: