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    Published on: August 18, 2022

    Today, I engage in an extended conversation with Dr. Russell Zwanka, Director of the Food Marketing Program and Professor of Category Management and Food Marketing at Western Michigan University, about his new book, "The Store Walk: A Walk Through A Grocery Store in Today's Environment."  This is Zwanka's 25th book - a number that makes me feel like an underachiever - and I think it reads like a great primer for new food store employees without a sense of history and context.  In this chat, we talk about evolution in the food retailing world, and where the future may take us.

    If you want to listen to this conversation as an audio podcast, click below.

    You can order your copy of "The Store Walk: A Walk Through A Grocery Store in Today's Environment" here.

    Published on: August 18, 2022

    by Kevin Coupe

    Axios reports that there is a new nonprofit, "led by an A-list of C-suite executives," that is working to design a playbook to help companies meet employees' mental health needs.

    According to the story, "Recognizing that burnout from the pandemic has even reached the corner office, Project Healthy Minds is trying to reduce the stigma of mental illness by getting CEOs to talk openly about their struggles — and to enact meaningful policies.

    Driving the news: Project Healthy Minds is building what it calls the 'first direct-to-consumer digital mental health marketplace' — a one-stop shop for finding a crisis hotline, a psychiatrist, a substance abuse treatment program or other relevant help …  Project Healthy Minds plans to compile a robust library of research on best practices in mental health programs, plus develop metrics by which companies can be assessed."

    The CEOs apparently have found the current situation to be Eye-Opening.  One of them decided to call his company's employee assistance program (EAP) hotline to see what would happen - and was put on hold for 12 minutes.  And then, when someone came on the line, the first thing he had to do was give his employee ID number, not talk about the reason he was calling.  If he'd been on the verge of suicide, for example, this scenario is unacceptable, the story suggests.

    Have you called your employee assistance hotline?  Do you have one?

    You can find out more about Project Healthy Minds here.

    Published on: August 18, 2022

    FMI-The Food Industry Association yesterday released its inaugural The State of Fresh Foods report, which it said "highlights findings from the-soon-to-be-released The Food Retailing Industry Speaks 2022 analysis and substantiates unwavering momentum for fresh foods departments in grocery."

    One major surprise:  "Fresh food offerings are becoming more prominent players in ecommerce. Fresh or perimeter departments now comprise 40% of all online sales, rivaling dry grocery online sales (41%) and surpassing frozen online sales (11%)."

    Some other highlights:

    •  "Food retailers are re-envisioning fresh foods departments with enhanced space allocation and increased staff. Eighty-two percent are planning to grow the space allocation for fresh-prepared grab-and-go options, while others are increasing space for fresh-prepared chef made-to-order stations (35%) or fresh-prepared self-service (29%). Retailers are also increasing staff for foodservice (44% of retailers planning), trained or certified chefs (22%), in-store dining (20%), and scratch bakers or pastry chefs (18%)."

    •  "Food retailers surveyed are getting creative with their service differentiation strategies by experimenting with new consumer touchpoints, like in-store dining (51%), a coffee bar (39%), online ordering and pickup/delivery of foodservice offerings (33%), catering services (30%), a juice bar (20%) and a full-service restaurant (13%).

    "However, the success of these programs has been mixed. Retailers report a success rate of as high as 60% for juice bars to as low as 13% for online ordering and pickup/delivery of foodservice offerings, revealing an opportunity for retailers to explore other specialty options."

    KC's View:

    The thing is, fresh foods always has been the segment in which food retailers could differentiate themselves.  The vast majority of items sold in most stores are sold in every store, but it is in fresh - with an investment in innovation - that companies can present a unique and fresh - pun intended - to shoppers.

    Here's a mandate you should give your stores:

    Each fresh department will have at least one totally unique item that the competition does not have … and will be charged with creating at least one new completely unique item each quarter.  No exceptions.  Total employee participation will be not only encouraged, but rewarded.  (One additional priority here:  Henceforth, we only will use the term "fresh food."  Never "perishables," because perishables rot.)

    Start there … and maybe give FMI something really extraordinary to talk about next time it issues this report.

    Published on: August 18, 2022

    From TechCrunch:

    "TikTok announced today that it’s launching a new commerce ad suite called 'Shopping Ads' to make it easier for brands to advertise on the platform. The company is currently testing three formats of Shopping Ads, including Video Shopping Ads, Catalog Listing Ads and LIVE Shopping Ads.

    "The new Video Shopping Ads allow advertisers to highlight one or more products in their in-feed video ads in a way that amplifies product discovery and purchase intent. TikTok says video Shopping Ads provide dynamic experiences based on the shopper’s intent to purchase, with smart targeting and optimized ad delivery. Video Shopping Ads essentially put brands’ shoppable videos in front of users who are more likely to buy them. The ads will also automatically create a landing page to better determine a user’s intent to purchase.

    "Video Shopping Ads are currently available to select advertisers for beta testing."

    The announcement comes as the Wall Street Journal reports that "Amazon is testing a feature in its app that would show users a TikTok-style photo and video feed of products for shoppers to share with other users … The portal being tested under the internal name 'Inspire,' appears as a diamond widget on the home page of Amazon’s app, according to Israeli-based artificial intelligence firm Watchful Technologies Ltd., which has tracked the feature’s use. The widget brings shoppers to a feed that shows a stream of images and videos of products, with shoppers able to like, share and ultimately purchase items. While most of the feed now appears as still pictures, Watchful researchers said the portal also features video content."

    The Journal writes that "the test is currently visible to a small number of Amazon employees, according to a person familiar with it."  An Amazon spokeswoman tells the Journal that the company is “constantly testing new features to help make customers’ lives a little easier.”

    KC's View:

    Amazin isn't alone, of course.  As the Journal notes, it joins other major technology companies such as Meta Platforms Inc. and Google parent Alphabet Inc. that have attempted to bump up engagement through short videos and an endless stream of content."

    I must admit that this is where I feel old - I have very little interest in this stuff as a consumer.  Which is why retailers need to make sure that they have young people who do understand these rules of engagement to drive them in important new directions.

    Published on: August 18, 2022

    The Wall Street Journal reports that "a federal judge in Ohio has ordered the companies owning CVS, Walgreens and Walmart pharmacies to pay $650 million over 15 years to two Ohio counties after a jury found them liable for contributing to the opioid epidemic.

    "The jury’s verdict last November, delivered after a six-week trial, came in a so-called bellwether case that attorneys elsewhere have watched closely. It was the first decision reached among lawsuits targeting pharmacy chains for their alleged role in the opioid crisis.

    "U.S. Judge Dan Polster in Cleveland issued his order on Wednesday after a separate nonjury trial was held to determine the appropriate amount the companies must pay."

    Essentially, the story says, the ruling means that "the defendants were responsible for a portion of plans created for Lake and Trumbull counties, the plaintiffs in the case, to address problems linked to the opioid epidemic. He ordered the companies to immediately pay two year’s worth of those payments into a fund, or $86.7 million of the total $650.6 million."

    The three companies said they plan to appeal both the jury verdict from last fall as well as the judge's order this week.

    The Journal writes that "attorneys for Lake and Trumbull counties had argued in their lawsuit that the pharmacies failed to stop pain pills from flooding the northeastern Ohio counties and false prescriptions from being filled. More than 80 million opioid pills were shipped to Trumbull County, with a population of less than 200,000, from 2006 to 2012, according to government data. More than 60 million opioid pills were shipped to Lake County, with a population of about 230,000, over that period.

    "The counties argued that by enabling the opioid crisis the pharmacy companies had created a public nuisance costing them each about $1 billion in law-enforcement, social-services and court expenses."

    The New York Times writes that "Judge Polster’s ruling not only sharply scolds the pharmacy chains for their business dealings in the two Ohio counties, but also implicitly stands as a warning to these companies in other pending cases. Of the three groups of defendants, the pharmacy chains have been the most reluctant to settle cases."

    KC's View:

    I understand the argument being made by people like Michael DeAngelis, a CVS spokesman, who says that “pharmacists fill legal prescriptions written by D.E.A.-licensed doctors who prescribe legal, F.D.A.-approved substances to treat actual patients in need," and therefore, drug retailers should not be held culpable.

    But it is interesting.  All three of these companies - CVS, Walgreen and Walmart - want to play a great role in the health care continuum.  They want their pharmacists to be more than pharmacists.  But not in this case.  In this case, they essentially bring out the "we were just following orders" defense.

    I'm not sure about the legalities.  I do know that a lot of companies - including CVS, Walgreen and Walmart - made money on the opioid crisis.  It is hard for me to feel or find sympathy for any of them.

    Published on: August 18, 2022

    MediaPost reports that "Ikea is partnering with Electrify America to quadruple the number of electric vehicle chargers at its U.S. stores … the retailer will bring ultra-fast public charging stations and delivery fleet electric vehicle charging to at least 25 stores … In total, there will be more than 200 individual ultra-fast chargers offering the fastest charging speeds available today – 150kW to 350kW – at Ikea retail locations in 18 states including Arizona, California, Connecticut, Florida, Illinois, Kansas, Texas, Utah, Virginia and Washington.

    "The first locations are expected to open in late 2022 and be completed by the end of 2023."

    The story notes that "Ikea has the goal of reaching zero-emission home deliveries by 2025 and halving relative emissions from customer and co-worker travel by 2030."

    It is an interesting development, especially in view of the New York Times story the other day about how "the electric vehicle revolution is nearly here, but its arrival is being slowed by a fundamental problem: The chargers where people refuel these cars are often broken.

    "One recent study found that about a quarter of the public charging outlets in the San Francisco Bay Area, where electric cars are commonplace, were not working.

    A major effort is underway to build hundreds of thousands of public chargers — the federal government alone is spending $7.5 billion. But drivers of electric cars and analysts said that the companies that install and maintain the stations need to do more to make sure those new chargers and the more than 120,000 that already exist are reliable.

    "Many sit in parking lots or in front of retail stores where there is often no one to turn to for help when something goes wrong. Problems include broken screens and buggy software. Some stop working mid-charge, while others never start in the first place.

    "Some frustrated drivers say the problems have them second-guessing whether they can fully abandon gas vehicles, especially for longer trips."

    KC's View:

    Does this presage a new era in which retailers invest in working EV chargers that may make them preferred locations for consumers?  I would think so.

    Published on: August 18, 2022

    The Associated Press reports that numbers issued by the US Commerce Department indicate that retail sales were flat during July compared to the previous month and that, when autos and auto parts are excluded, retail sales rose 0.4 percent during the month.

    This follows a June in which retail sales grew 0.8 percent.

    Compared with 12 months ago, overall retail sales rose 10.3% in July.

    The AP writes that "America’s consumers, whose spending accounts for nearly 70% of U.S. economic activity, have remained mostly resilient even with year-over-year inflation near a four-decade high, rising economic uncertainties and the surging costs of mortgages and borrowing money. Still, overall spending has weakened, and it has shifted increasingly toward things like groceries, and away less necessary things like electronics, furniture and new clothes … Inflation continues to pose a severe hardship for many families. Though gasoline prices have fallen from their heights, food, rent, used cars and other necessities have become far more expensive, beyond whatever wage increases most workers have notched."

     NRF Chief Economist Jack Kleinhenz, chief economist at the National Retail Federation (NRF), released a statement saying that "consumer spending was an encouraging signal as the economy kicked off the third quarter. Nonetheless, inflation is still disturbingly high even as it eases and is the most important challenge for consumers and retailers. The future path of inflation remains a key factor for the economy and monetary policy as the Federal Reserve works to bring price increases under control."

    Published on: August 18, 2022

    •  From the Wall Street Journal this morning:

    " is searching for a senior movie-studio executive to help lead its growing entertainment division, turning to rivals for a chance to poach an experienced Hollywood player.

    "Amazon Studios has held conversations with several Hollywood leaders about the role, including Netflix Inc.’s film head, Scott Stuber, one of the streamer’s most powerful and visible executives, according to people familiar with the matter.

    "It couldn’t be determined if the talks are ongoing.

    "Mr. Stuber is one of several candidates who have talked to Amazon about the role, the people said. The company also held discussions with former Paramount Pictures executive Emma Watts about a position, the people said.

    "The conversations Amazon had with Mr. Stuber and others come amid power shifts under way in Hollywood and fresh vulnerabilities at the industry’s dominant streaming service. At Netflix, where Mr. Stuber helped cement the company’s status as the streaming industry’s dominant player, he oversees a division that has produced dozens of movies, including Martin Scorsese’s Mob drama 'The Irishman' and the big-budget action release 'The Gray Man'.

    "Yet, Netflix has of late signaled a retrenchment, as rivals like Walt Disney Co. spend heavily to surpass it in subscriber numbers and content offerings. Netflix’s global rise has slowed, leading it to cut spending and scale back operations. At Amazon, executives have spent billions of dollars this past year hoping to augment its Prime service, using A-list stars to lure subscribers."

    Published on: August 18, 2022

    With brief, occasional, italicized and sometimes gratuitous commentary…

    •  From the Washington Post this morning:

    "Home improvement retailer Lowe’s is offering hourly employees $55 million in bonuses to help offset the sting of inflation, which has remained near 40-year highs all summer, the company announced on an earnings call Wednesday.

    "'In recognition of some of the cost pressures they are facing due to high inflation, we are providing an incremental $55 million in bonuses to our hourly front-line associates this quarter,' Lowe’s chief executive Marvin R. Ellison said on the call. 'These associates have the most important jobs in our company, and we deeply appreciate everything they do to serve our customers to deliver a best-in-class experience.'

    "Lowe’s is offering this incentive, even as inflation moderated slightly, with gas prices softening in July from their peak the previous month, a welcome sign for the policymakers at the Federal Reserve, which has been raising interest rates to combat inflation.  These bonuses will give a boost to workers at a time when food, housing and other costs remain high, disproportionately affecting the lowest income households. The temporary relief doubles as a retention bonus in a booming labor market that has afforded workers leverage to quit their jobs and negotiate higher wages."

    •  Fast feeder Subway said this week that it plans to add automatic slicers to its 22,000 restaurants over the coming year, instituting a program in which employees can use them to slice meat in the morning and afternoon to provide a great sense of freshness.

    Meat will not be sliced to order, but this is considered to be an improvement over the current program in which meat is sliced in central facilities and shipped that way to stores.

    Wait a minute.  Subway serves actual meat?  I am gobsmacked.

    Published on: August 18, 2022

    Got the following email from MNB reader Monte Stowell:

    Regarding Target’s latest sales results. If you have not been in a Target for awhile, the reason their sales looked dismal is simple. Of all the major retailers, their out of stock position in many food and non- food categories was horrible. Thank goodness for DSD food vendors to make some the shelves look full, as many of Targets competitors made their shelves look full by filling the voids with something. The pandemic has not been good to Target compared to other major retailers. In other words, they do not have the mojo they once had. Not just my opinion, but also to many of  our friends and family.

    We had a piece yesterday about Albertsons testing two stores with only self-checkout, and my question was why the company isn't leaping past that to checkout-free stores.

    One MNB reader responded:

    There is one big issue for many of us consumers who shop at Albertsons or Safeway We can download Digital Coupons to our smartphones, and bingo, we go through the self checkout line or a line with a checker. I would say that more than half the time the damn Digital Coupon does not work. You have to get a checker to come over and fix the missing Digital Coupon. This happened yesterday when my wife and I downloaded 3 Digital Coupons, and none of them came off. We had to drive back to the store to get the correct amount downloaded to out Mastercard, which was almost $13.00. Just wondering how many other people do not take the time to double check their receipts.

    Bottom line for me for Albertsons/Safeway, you still have some work to do to make the customer experience totally seamless and a positive one.

    From another reader:

    Just had this discussion with a sales rep in New England the other day.  We discussed Market Basket vs other retailers.  To shorten a long discussion, the conclusion is that self-checkout, in our opinion is a sales killer for the stores.  When you have man (person) hour requirements, to have people on registers that produce small orders, they don’t pay for themselves.  That is why stores went to the “self-checkout”.  Now stores are leaning on this even further, trying to position this as a great thing for their customers, which actually what happens is they are forcing the basket size down because people are not going to stand at a self-checkout for a full basket trip and struggle through “oh this doesn’t scan”, or I need help and have to wait for the “standing by” associate to help.  Exception, MB.  They don’t do self-checkout and are totally committed to service.  That is why among other things, when they open a store in a market, they eat the lunch of others around it.  In your column you consistently talk about how retailers have to adjust, this would be an easy adjust, and keep people coming back. 

    And from MNB readerDuane Kolsrud:

    Despite using the self-checkout at my store in Minnesota, I have issues with stores going full self-checkout.

    It is excruciating watching older clientele try to navigate the machines- heck, it's painful regardless of age if they are new to the system. 

    Can they make the PLU stickers a bit larger for items in produce so one can actually read the number vs. guessing what type of apple they should choose from the menu? The one thing that consistently works at self-checkout is the little red light above the register.

    I realize they are saving on labor costs but there is something to say about good customer service(a lost art in retail these days).

    And if they genuinely save the stores money in the long run, then it's painful to be paying over $6.00 for a 12-pack of Coca-Cola.  

    And from MNB reader Steven Ritchey:

    So Albertson's needs to take the plunge into checkout free stores.

    Easy for you to say.

    I'm in stores daily, and I hear and see the pushback on self checkout now.

    My take is that if they do this, either total self checkout, or checkout free stores, they need to demonstrate greater service elsewhere, that those employees are being put to work in other parts of the store and not just laid off as not being needed anymore, because that's where the pushback is coming from, is people believe self checkout means the customer is doing the store's job for them, yet not seeing any difference in the prices they pay.

    Just food for thought.

    Finally, I got a number of emails regarding yesterday's FaceTime, in which I opined about an email from an MNB reader responding to our stories about all the things put at risk by climate change - including parmesan cheese and arborio rice production, as well as the glass used in wine bottles - by asking if I'd be willing to solve climate change issues by consuming Rice-A-Roni, processed and inferior parmesan cheese, and boxed wine.  I said I would, though it would hurt.  I also suggested that people who would suggest such an unlikely scenario probably don't take pleasure from grating fresh parmesan, stirring a risotto, or opening a bottle of wine.  And I extended it to driving a stick shift - it is almost impossible to buy a car with a manual transmission these days, as we become a society in which the cars drive us as opposed to our being able to feel the road as we shift from third to fourth to fifth…and I did the FaceTime video while driving my convertible Mustang, which has a manual transmission.

    As I said, a lot of emails showed up, many of them about the neighborhood in which I was driving

    MNB reader Henry Stein wrote:

    I enjoyed your Facetime Video about choosing Rice-A-Roni or Boxed Wine if mandated or highly suggested to help in climate change efforts.

    But I have to confess, I was distracted by the 10,000 sq. ft. homes you drove by. I bet Boxed Wine would not be an option made in that CT neighborhood…..

    MNB reader Jody Schweer wrote:

    Not sure where you were driving but I think I need to live there.

    And from another reader:

    Jeez, what a nice neighborhood you were driving through, lots of McMansions. Being a blogger with attitude must pay pretty well!

    And MNB reader Linda Reiring wrote:

    Remember when Nancy Pelosi shared her lockdown experience in the early stages of the pandemic with a video taken in her very large gourmet kitchen that her personal chef manages?  It wasn’t very relatable and created some backlash with her constituents.  Well…I didn’t hear a word you said in your FaceTime with the Content Guy video today.  I just kept looking at the incredibly beautiful and quite large homes in the background.  There’s a lot more Rice A Roni household budgets out there than freshly grated parm and fine wine households.  Not all of your readers are in the 2%. 

    To be clear, I'm not in the two percent, either.

    That's not my neighborhood and certainly not my street.  It's my town, but I live on the other side of the tracks.  We've been in the same house for 38+ years, on a short dead-end street … it would've been really boring for me to drive on my street, back and forth, over and over … plus, I wouldn't been able to get the car into fourth gear…

    Speaking of the car, one MNB reader wrote:

    Have no problem with anything you said…..I’m with you except, I will not give up my manual transmission hardtop.

    Viewers want to know, “What u be driving there?”

    That's my eight-year old grey Mustang convertible, which I got when I turned 60.  (Before that, I drove two Miatas over a period of 20+ years.  Also with manual transmissions.)

    Another MNB reader wrote:

    Interesting you choose to respond to a climate change email while driving a fossil fuel car… 

    Fair point.  Just FYI, it does get 30 MPH on the highway.  But I do feel a little guilty about it.  (Mrs. Content Guy drives a Mini hybrid.)

    And, from MNB reader Michael W. Bruce:

    Well, you did pretty well with watching the road, but, what about “Hands on the Wheel”?

    I know, with all your zest and enthusiasm you couldn’t express yourself fully without both hands in motion.  Loved the ride, almost like being there with you!

    I'll tell you a funny story.  After I recorded the video, I stopped at a store, and when I came out, there was a gorgeous navy blue BMW Z4 parked next to me.  I was admiring it when the owner came out, and I told him how much I liked his car.  He told me that he liked my Mustang, but when I suggested that his car outclassed mine, he said, "But yours has a manual transmission - I couldn't get that on mine."

    Go figure.  (He didn't offer to trade, though.)