business news in context, analysis with attitude

Published on: October 19, 2021

by Michael Sansolo

It seems there’s no topic around these days that isn’t an immediate cause of conflict. Whether it’s public health, vaccinations, education, politics or even sports, music or fashion, opinions are always stunningly divided.

For that reason, it’s so shocking to report on an area of widespread agreement and in this case, the finding has tremendous importance to the food industry.

The newest report from the Coca-Cola Retailing Research Council of North America found this shocking bit of agreement: everyone is concerned about the environment and sustainability.  They just want to know what to do about it. The study found similar levels of concern from shoppers no matter how the data was sliced and diced -  by income, education, region or even by political leanings.

Full disclosure: I’m the research director of the Council.

If nothing else, this highlights the fact that this is an issue you need to address. Especially since consumers recognize that most of the waste they personally create comes from products they largely buy at supermarkets. (Not surprisingly, that’s especially true concerning food waste.)

And while shoppers recognize they have a role to play in addressing this issue, they clearly put a lot of expectations on the food industry to take the lead. Curiously enough, that doesn’t have to mean anything negative.

In fact, two members of the council recently discussed the issue with me as part of a recent workshop panel and each found reason for action and even, shockingly enough, optimism.

The optimism comes from how Generation Z was the only demographic segment that was noticeably different in their feelings about this issue. Gen Z (today’s youngest adults and oldest teens) are far more concerned about sustainability than all other population segments with 56% telling us they think about the issue in all buying decisions.

John Ross of IGA sees this is an enormous opportunity. During the workshop I did with Ross, he raised the obvious point that Gen Z is the future of both shoppers and staffers for the industry. Their loyalty as shoppers, based on our research, could be enhanced by companies taking, and clearly communicating, steps on sustainability.  (For example, many shoppers want to see food retailers partner with food banks, apparently unaware that such activities have gone on for years.)

But Ross says the less obvious advantage is that Gen Zers want to work for companies that share their concerns, which means supermarkets working on sustainability might find the issue a useful tool in attracting and retaining staffers. Given the current labor shortages, Ross’ point certainly seems worthy of consideration.

Ted Balistreri of Sendik’s added another aspect of this discussion that makes the entire topic sound even more important. The CCRRC study found that shoppers have a level of anxiety about sustainability thanks to their confusion over how to act more sustainably themselves. As Balistreri said, businesses succeed whenever they help relieve consumer anxiety.

And in that regard, taking and communication action on sustainability may help shoppers feel better about their store and themselves at the same time.

It’s hard to find anything to disagree with in that idea.

The study, Sustainability and Food Retailing, can be downloaded for free here. 

Michael Sansolo can be reached via email at msansolo@mnb.grocerywebsite.com.

His book, “THE BIG PICTURE:  Essential Business Lessons From The Movies,” co-authored with Kevin Coupe, is available here.

And, his book "Business Rules!" is available from Amazon here.

Published on: October 19, 2021

Michael Sansolo's MNB column today may have focused on a subject about which all generations have a measure of agreement, but there still is a generational freight train hurtling down the tracks.  Think Generation Alpha, which hasn't even been completely born yet, but will be both enormous and enormous challenge for marketers.

Published on: October 19, 2021

CNBC reports that Walmart plans to give its Walmart+ members advance access to its Black Friday deals, which, if outside estimates are to believed, has the potential of making some 32 million US households feeling a little more joyful about the end-of-year holiday shopping season.

The story says that the offering will come in the form of four-hours of advance access each day as new deals roll out throughout November.

The story says that "Walmart is betting it can use that perk to boost its membership — particularly at a time when many holiday shoppers are already worried about out-of-stocks … Walmart sees Walmart+ as a way to drive loyalty and win more of customers’ wallets, much like Amazon has done with Prime. It launched Walmart+ about a year ago, shortly before the last holiday season. The membership program costs $98 a year or $12.95 on a month-to-month basis. It includes benefits, such as fuel discounts, access to an app that allows customers to skip the checkout line and free unlimited grocery deliveries to the home for orders of $35 or more."

Published on: October 19, 2021

The Wall Street Journal reports that a group of bipartisan members of the US Congress's Antitrust Subcommittee have written to Amazon CEO Andy Jassy asking him "to provide 'exculpatory evidence' to corroborate the sworn testimony that several leaders, including then-CEO Jeff Bezos," provided to the subcommittee in 2019 and 2020 testimony about how the company uses "data from third-party sellers as it has developed private-label products."

The question, the Journal writes, is whether "executives misled them during an investigation of the company’s business practices and if they may have lied under oath … At issue is how Amazon responded to accusations that it uses the data of third-party sellers on its site when creating private-label products. Amazon executives repeatedly told members of the subcommittee in testimony and in written responses that it doesn’t use the data of individual third-party sellers to inform its vast lines of its own brands."

The bipartisan group includes Reps. David Cicilline (D-Rhode Island), Ken Buck (R-Colorado), Pramila Jayapal (D-Washington), Jerrold Nadler (D-New York) and Matt Gaetz (R-Florida).  The letter said, in part, "We strongly encourage you to make use of this opportunity to correct the record and provide the Committee with sworn, truthful, and accurate responses to this request as we consider whether a referral of this matter to the Department of Justice for criminal investigation is appropriate."

The Journal writes that "an Amazon spokesman said the company and its executives didn’t mislead the committee. He noted that Amazon has an internal policy prohibiting the use of individual seller data to develop Amazon products, and said that it investigates any allegations that the policy may have been violated. He also said the company designs the search function on its site to feature products customers want."

The Washington Post writes that "according to recent investigations by the Reuters news agency and the Markup, a data journalism nonprofit, Amazon has systematically used data it collects from third-party sellers to launch copycat products and has given its own goods a leg up against competitors on its search engine, practices the company has testified to Congress it does not engage in or are against its policies."

The Post also notes that Amazon has not said whether it will comply with the demands in the letter.

Published on: October 19, 2021

Whole Food is out with its annual predication for "cutting-edge flavors, products and ingredients that will win hearts, minds and menus" in the coming year … and, for the first time, it is offering a "Trends Discovery Box, a curated assortment of 10 products to represent each of the 10 trends in the forecast. The boxes, available for $30 (valued at over $50) allow you to taste all the trends at once."

The trends include:  

•  Ultraurban Farming, because " innovation in indoor farming has ballooned, from hydroponics and aquaponics to mushrooms grown above our grocery aisles — and even fresh produce grown by robots. Producers are finding new, boundary-pushing ways to grow hyper-local crops and maximize efficiency."

•  Yuzu, described as "a lesser-known citrus mainly cultivated in Japan, Korea and China — is taking the culinary world by storm. Tart and sour, this tangerine-sized fruit is popping up in vinaigrettes, hard seltzers, mayos and more. In the restaurant scene, chefs are using its lime-lemon-grapefruit flavor to accent their soups, veggies, noodles and fish. Get ready to see this fruit shine in 2022 — both on and off the grocery aisles."

•  Reducetarianism, which is when plant-curious eaters reduce their "consumption of meat, dairy and eggs without cutting them out completely."

•  Buzz-Less Spirits:  "With millennials and Gen Z-ers dabbling in 'drysolation' during the pandemic, we don’t see the sober-curious mindset going away anytime soon. Enter a new lineup of drinks that provide the taste and sophistication of cocktails without the buzz. If you want to shake things up, there are elegant mocktail options to explore."

Published on: October 19, 2021

Random and illustrative stories about the global pandemic and how businesses and various business sectors are trying to recover from it, with brief, occasional, italicized and sometimes gratuitous commentary…

•  In the United States, there now have been 45,902,575 Covid-19 coronavirus cases, resulting in 746,415 deaths and 35,572,825 reported recoveries.

Globally, there have been 241,892,037 coronavirus cases, with 4,920,551 resultant fatalities and 219,230,912 reported recoveries.  (Source.)

•  The Centers for Disease Control and Prevention (CDC) says that 77.1 percent of the US population age 12 and older has received at least one dose of vaccine, with 66.7 percent of the same group being fully vaccinated.

The CDC also says that 14.6 percent of the US population age 65 and older has received a vaccine booster dose.

•  From the Wall Street Journal:

"The Food and Drug Administration is moving to soon allow people to receive booster shots that are different from their first Covid-19 vaccine doses, people familiar with the matter said.

"The FDA won’t recommend any booster over the others but will permit people to get a booster shot that is different from the shot they first received, one of the people familiar with the matter said.

"The FDA is seeking to authorize mixing and matching as soon as this week, the people familiar with the matter said. The FDA is also expected to approve Moderna Inc. and Johnson & Johnson boosters this week, according to a person familiar with the matter.

"The FDA has authorized extra doses of vaccines from Pfizer Inc. and partner BioNTech SE and from Moderna for people with compromised immune systems. The FDA has also authorized Pfizer-BioNTech boosters for seniors and other people at high-risk of severe illness."

•  From NBC News:

"Older Americans have been the most at risk of dying throughout the Covid pandemic. Now, data from the Centers for Disease Control and Prevention shows that adults over the age of 65 make up the bulk of breakthrough Covid deaths.

"The data, published Friday, shows that 85 percent of the approximately 7,000 breakthrough Covid deaths recorded by the CDC have occurred in adults 65 and older. By comparison, adults at and over the age of 65 made up 76 percent of the more than 700,000 Covid deaths recorded by the CDC.

"The Covid vaccines still offer powerful protection against severe Covid cases. In August, unvaccinated people were six times more likely to test positive for Covid and 11 times more likely to die than vaccinated individuals, CDC data shows."

On the heels of this research, there has been coverage of the Covid-related death of Colin Powell noting that in some circles, it is being pained as a clear evidence that vaccines don't work.

The Washington Post has a column from Philip Bump in which he observes that rather, "it’s a reminder that the virus still poses a risk to the elderly, even when vaccinated, and therefore that the goal should be to tamp down on the spread of the virus broadly. If Powell had been at little risk of contracting the virus because transmission rates were low, he would have been at almost zero risk of dying from it. But, instead, his death comes at a time when more than 80,000 people a day are still contracting the virus and more than 1,500 people are dying from it — about as many people as were dying in early April 2020.

"The reason that health experts advocate vaccination is, in part, because it offers increased protection to individuals both from infection and death. But that, to some extent, is the icing on the cake. The broader advantage in widespread vaccination is that the virus has far less ability to spread, given how well protected the vaccinated are against contracting the virus. This is the goal of reaching herd immunity, creating a situation in which the virus can’t spread because it can’t find hosts without antibodies prepared to fight it. When the United States achieves herd immunity, 84-year-olds with preexisting conditions will be better protected against death simply because they will be at much lower risk of contracting the virus … It seems inevitable in this moment that Powell’s death will prompt new indifference to the vaccine, as though his death somehow proves that the vaccines don’t work. The lesson we should learn instead is that the vaccines work best when they work broadly and that, had Powell been protected both by the vaccine and by low rates of infection in his community, he might still be alive."

•  The New York Times reports that "the reluctance to get vaccinated is producing an alarming surge: in Russia, according to public health experts.

"On Saturday, Russia exceeded 1,000 deaths in a 24-hour period for the first time since the pandemic began. (Britain, with a little less than half the population, had 57 deaths in a recent 24-hour period.) On Monday, Russia broke another record with more than 34,000 new infections registered in the previous 24 hours.

"Only about 42 million of Russia’s 146 million inhabitants have been fully vaccinated, Prime Minister Mikhail Mishustin said last week, a rate well below the United States and most countries in the European Union.

"But even with a record-breaking death toll, the government has imposed few restrictions, and its vaccination campaign has floundered, sociologists say, because of a combination of apathy and mistrust."

Sounds like a role model.  Just not sure for what.  (Actually, I am sure.  I'm just being obstreperous.)

Published on: October 19, 2021

With brief, occasional, italicized and sometimes gratuitous commentary…

•  Bloomberg reports that Amazon "plans to hire 150,000 seasonal staffers, about 50% more than last year as the company seeks a cushion of workers to help it meet demand during the holiday shopping period … Amazon said on Monday that the average starting pay of jobs in the U.S. was $18 an hour. Facing fierce competition for entry-level workers, the company has also been offering signing bonuses of as much as $3,000, depending on location, and as much as an additional $3 per hour for workers willing to work overnight or weekend shifts."

•  Tesco is scheduled to open its first checkout-free store today, the BBC reports.

The company said that a store "in High Holborn had been converted to allow customers to shop and pay without scanning a product or using a checkout.

"The new format, known as GetGo, follows similar stores opened by Amazon.

"Customers with the Tesco.com app will be able to pick up the groceries they need and walk straight out again.

"Tesco said 'a combination of cameras and weight sensors' would establish what customers had picked up and charge them for products directly through the app when they left the shop.

"The technology is provided by Israeli tech start-up Trigo, which has similar partnerships with supermarkets in Germany and the Netherlands."

•  CNN reports that "Sephora has launched a same-day delivery service just ahead of the holiday shopping season, which is set up to deliver purchases within two hours for a fee.

"Here's how it works: customers who place an order on Sephora's website, or through its app, can select the same-day delivery option, enter their address, and a courier picks up the order from the nearest Sephora store for delivery. The service has a flat fee of $6.95.

There's also an option to cancel the order within a 15-minute window of it being placed … The new service is now available seven days a week in most major cities and suburbs, the company said, but online orders must be placed by 4 p.m. local time for same-day delivery. The retailer already offers other options, including buying online, pick-up in store and curbside pick-up."

One expert described the rationale behind the move this way:  "There's increasing expectation for on-demand everything."  Which is as good a description of the 2021 marketplace as I can think of.

•  From Bloomberg:

"Amazon’s self-driving vehicles unit Zoox will start testing autonomous cars in Seattle, bringing the robotaxi maker closer to its parent company and a pool of engineers it sees as key to launching commercially.

"Foster City, California-based Zoox will deploy a fleet of Toyota Highlander vehicles retrofitted with its sensor technology and autonomous-driving software. The company hopes Seattle’s climate will help prepare its technology to drive in a wider range of environments. Currently, Zoox is testing vehicles in the comparatively drier climes of Las Vegas, San Francisco and its Bay Area hometown. Zoox will also open an office in Seattle next year."

Published on: October 19, 2021

•  Albertsons said yesterday that its Q2 revenue was $16.5 billion, up from $15.8 billion during the same period a year ago, driven by a 1.5 percent increase in same-store sales.  The company said that "digital sales increased 5%; on a two-year stacked basis digital sales growth was 248%."

•  FMI-The Food Industry Association announced yesterday that as a founding member of the U.S. Coin Task Force, it "s encouraging all Americans to assist in increasing coin circulation this October during 'Get Coin Moving' Month to support their fellow citizens and businesses that rely on coins for everyday cash transactions. The Task Force, which includes representatives from the U.S. Mint, the Federal Reserve, armored carriers, coin aggregators, and financial sector and retail trade associations, was formed in July 2020 to identify and promote strategies to resolve the coin supply chain issues resulting from COVID-19-related disruptions to normal coin circulation."

In a prepared statement, Jennifer Hatcher, Task Force member and FMI Chief Public Policy Officer and Senior Vice President, said, “Our country is currently facing a coin circulation problem. In the food retail industry alone, 11% of all transactions are paid in cash. The best way to address the scarcity of coins impacting our business community and Americans reliant on legal tender for everyday purchases like groceries is to ‘get coin moving’ by spending or depositing the coins people have accumulated prior to and during the COVID-19 pandemic."

Would't it be simpler for everybody to just round up or down all their prices so that nobody has to worry about coins?

Published on: October 19, 2021

•  The Organic Trade Association (OTA) announced "the launch of a nationwide search for a new CEO and Executive Director. After more than a decade of service to OTA and the organic community, current CEO Laura Batcha plans to step down in spring 2022 … The trade association has hired global organizational consulting firm Korn Ferry" to lead its search for a new CEO.

“If there’s one thing I’m feeling right now, it’s confident,” says Batcha. “Confident in my team at OTA, confident in the great folks at Korn Ferry who we’ve brought on to help with our search, and confident that the next person we select to lead this organization is going to bring a new outlook, fresh ideas, and a dedication to moving organic forward.” 

Published on: October 19, 2021

Colin L. Powell, the child of Jamaican immigrants who had a remarkable career of public service, eventually becoming the Chairman of the Joint Chiefs of Staff and later the first Black Secretary of State, has passed away.  He was 84.   Powell, who served at the highest level for four different presidents of both parties, died from complications related to Covid-19;  while he was fully vaccinated, the Washington Post writes, Powell "had Parkinson’s disease and multiple myeloma, a form of blood cancer that impairs the body’s ability to fight infection."

Published on: October 19, 2021

Yesterday's MNB featured an extended conversation about the subject of loyalty, precipitated by a story I did a few months ago  about an element of a new loyalty program developed by Price Chopper/Market 32 and powered by tcc Global, that allows shoppers to compile points that can be converted into dollars that then can be used to help pay off student debt.  This struck me as an ingenious idea - highly relevant, and the kind of thing that would encourage people to brings their friends and families into the program.  For an update on the program, and a broader discussion about loyalty marketing, I engaged with Sean Weiss, Director of Loyalty Marketing & Analytics at Price Chopper/Market 32, and Dan Dmochowski, President-North America, at tcc Global.

MNB reader Bob Wheatley responded:

Excellent discussion. I have an alternative view to offer:

I’m not sure that putting a slightly more fashionable lipstick color on loyalty programs works optimally anyway when the business environment has already transformed. The retail and CPG marketing game has shifted away from command and control (persuasion around price and value incentives) to the Customer Relationship Era.

Sustainable customer relationships are now built on admiration and trust and recognition of that can deliver significant financial premiums. This means retailers have a responsibility now to push added meaning, trust and belief to the forefront of the customer relationship. This creates the opportunity for transcendence – the state of being admired – where customers in effect “join” the retailer as community members, not merely shoppers.

Why? Because the world has changed and relating to a banner or brand is now fundamentally the same thing as relating to a person.

If (insert banner brand here) stores were to disappear from the face of the earth tomorrow, would anybody but financially interested parties truly care? Said more succinctly is retail brand advocacy now a more important and relevant goal than loyalty

Strategically I think so.

Another MNB reader also was skeptical: 

I have a national drug chain and a national food chain in my market (Philadelphia).  This is what I have to do to obtain a “loyalty reward”:

After reading their print ad, go to the chain website to see if there are other “loyalty” rewards … Download virtual savings to my card … Enter my loyalty reward number at check out … Hope that the system works and I get a loyalty reward.  It might be a $.10 savings.

I do the majority of my shopping at two independent retailers that pass along savings to all customers with “no card necessary for savings”.

It does sound like the two chains are making you jump through hoops.

From another reader:

Great discussion . Agree with you that student loan option is ingenious. But then, Price Chopper has been doing ingenious things with loyalty for over 30 years. Sean mentioned early on fuel rewards. Before that was computers for schools, discounts at amusement venues, seedlings given on Earth Day, logo cookies for High School fundraising, to name just a few. 

We also had a story yesterday about how so-called "uncomfortable inflation" is seen as changing shopping habits;  Bloomberg wrote that "consumers in Europe and the U.S. aren’t rushing to spend more than $2.7 trillion in savings socked away during the pandemic, dashing hopes for a consumption-fueled boost to economic growth on both sides of the Atlantic."

Which prompted MNB reader David Spawn to write:

Very interesting topic you presented here! 

It got me thinking about how much of this this savings/spending pattern may reveal a version of the “new normal” scenario that so often mentioned, particularly for services.  If one has grown more used to limited spending on services and has had plenty of time ‘practicing’ those habits, given the fits & starts with each new wave of COVID infections, it feel as if the likelihood of a specific collective moment that everyone decides to go out and spend all that money they’ve saved does not seem likely.

Honestly, it feels to me as if there will be a more gradual return that will leave a good portion of savings untouched.  I’m not sure how many “extra” visits to a service provider a consumer has to make in order for there to be a significant dent in the savings put in place over the last 19 months, and maybe it will come out of the “goods” part of goods & services, but it feels like we would have to be seeing much larger jumps in retail purchases for this to happen (especially on a month over month basis).

I also think that some segments of the population may have gained new habits that could take a long time to shed.  I look at my own activity as an example and while my husband & I are definitely eating out more, it’s still at a rate far lower than we did pre-Pandemic and we’re not picking up the slack in other areas in a noticeably visible way (and we will likely pull back as the weather turns colder – at least for dining).  I also wonder if these new habits may be ‘stickier’ for all those folks we read about who are leaving jobs and/or the labor market and may not want to go back to previous spending levels as they figure out what they are going to do next.

Thanks for keeping us thinking!

Also yesterday, we had a story about how Walmart is testing Text-to-Shop technology, and I commented:

Pretty soon, the way things are going, we're just going to have to think about a product, and the embedded electrodes in our brains will automatically order it from someone.

Which could be a problem for me, because I think about Twizzlers and Tito's a lot.  (Not necessarily in that order.)

One MNB reader responded:

This is probably opening up a cultural debate, but it has to be said.  Twizzlers belong at the bottom of licorice rankings clearly rank far below Red Vines. 

It may well open up a cultural debate.  Because, for my money, Twizzlers are far superior - I never eat Red Vines.  Never.

That said, as my father-in-law used to say, "Where taste is concerned there is no dispute."

Published on: October 19, 2021

•  In game three of the American League Championship Series, the Boston Red Sox dominated the Houston Astros, winning 12-3 and taking a 2-1 game lead in the best-of-seven series.

•  In Monday Night Football, the Tennessee Titans defeated the Buffalo Bills 34-31.