business news in context, analysis with attitude

Published on: September 17, 2013

by Michael Sansolo

Life is full of moments of humility. Frequently, when I’m exercising on my bicycle other riders zip by me, completely shattering my delusions of speed. (None of them on training wheels, thank goodness. At least, not yet.)

But here’s the thing: when that happens I always have two thoughts. First, I size up their sleeker bikes and professional-level clothing and remind myself that I’m not out there to race (but maybe I should trade up…) Second, I pedal harder, speed up and get a better workout.

That’s what competition and context does. Those forces remind us that we may not always be the best and push us to find ways to get better, stronger and faster.

I got thinking about that a week ago when I read an incredible article in the Washington Post about Steve Ballmer, the oft-criticized CEO of Microsoft, who recently announced his intention to retire. The article, detailing the company’s sluggish sales, began with an excerpt of an interview Ballmer did with Fortune in 2006. The interviewer asked Ballmer if he had an iPod.

“No, I do not. Nor do my children. My children - in many dimensions they’re as poorly behaved as many other children, but at least on this dimension I’ve got my kids brainwashed. You don’t use Google, and you don’t use an iPod.”

No doubt since 2006 Ballmer’s kids have been forbidden from using an iPhone, iPad, Facebook, Twitter and lord knows what else. And since they probably go to wonderful schools filled with the Zune-carrying/Bing searching children of other Microsoft executives, they probably have no idea what the rest of us are doing.

Kind of explains a lot, doesn’t it?

Sure, loyalty is fabulous, but think of what Ballmer might have learned if he simply let his children use Google. They might have found advantages or insights that all the professional competitive checkers at Microsoft have clearly been missing.

This article isn’t for Ballmer, but rather the rest of us because whether we admit it or not, we all do the same.

I’ve had the opportunity to visit far too many stores with excellent retailers who can rapidly find all the flaws at the competition that they manage to gloss over on their home turf. I’ve talked to too many manufacturers who can point out the shortcomings of a competitor’s product, marketing or supply chain, without seeing exactly the same problems in their own.

At those moments we are just like Ballmer and just like him we need to let the “kids” use an iPod. Just like him we need to let non-biased eyes (friends, neighbors and children) show us what we simply cannot see.

Kevin wrote last week of the danger of “breathing your own exhaust”—essentially getting too wrapped up in your own version of your own success. It's true -
context and competition really kill all the fun sometimes. Let’s be glad they do. Because that’s when we get better.

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 by clicking here .

Published on: September 17, 2013

Over the past week, close to five million people have viewed what essentially is an infomercial on YouTube.

But not just any infomercial. It is, in fact, what one critic has called "the most beautiful, haunting infomercial you'll ever see." The product is Chipotle, the upmarket Mexican fast food chain, but there is almost no reference to the brand or its products. Rather, the film - called 'The Scarecrow" - is a poetic look at the impact that processed food production can have not just on our stomachs, but also on our souls. The music is a Fiona Apple cover of "Pure Imagination," the song from "Willy Wonka and the Chocolate Factory, and it is perfect.

"The Scarecrow" isn;t just an attack on "big food," however. More importantly, it is a paean to the virtues - nutritional, psychological, spiritual, physical, economic - of sustainable farming practices.

And perhaps most importantly, "The Scarecrow" is incredibly well done. Kudos to Chipotle for commissioning it, and to Academy Award-winning Moonbot Studios for producing it.

Watch it. It is an Eye-Opener.

Published on: September 17, 2013

The Washington Post reports that the Washington, DC, City Council today is expected to vote on whether to override Mayor Vincent Gray's veto of a "living wage" bill that would require large retailers such as Walmart to pay employees at least $12.50 per hour, above the local minimum wage of $8.25.

Gray vetoed the bill, calling it a "job killer" and saying that it was impractical. Gray also pledged to try to raise the DC minimum wage.

The original bill was passed 8-5, but it will require nine votes to override the veto. According to the Post story, "none of the five council members has indicated a willingness to change his or her vote."

Walmart, which wants to open six stores in the district, has pledged to severely cut back on its plans there if the "living wage" bill becomes law.

Published on: September 17, 2013

The Associated Press reports that the fight in Washington State is "intensifying" as both sides debate the merits of a statewide initiative that would mandate the labeling of foods with genetically modified (GM) ingredients.

The statewide vote is scheduled for November 5.

The story says that "opponents of Initiative 522 have so far raised $12.1 million, with $4.8 million from Monsanto and $3.4 million from DuPont Pioneer, according to the latest reports filed with the Washington state Public Disclosure Commission. Both companies were top donors in the effort to defeat California’s Proposition 37.
The Yes on 522 campaign has raised $3.4 million, with nearly $1 million from Dr. Bronner Magic Soaps. Other top donors include the Organic Consumers Fund and Mercola Health Resources."

Opponents of the initiative say that it will result in misleading information that will frighten consumers and a costly infrastructure that will hurt farmers. Proponents say that consumers deserve to know what is in their food.

Published on: September 17, 2013

Advertising Age has a piece about how the beer industry's biggest companies, Anheuser-Busch InBev and MillerCoors, "are being battered by a new wave of competition from inside and outside the beer market and starting to lose their grip.

"On one side, newly aggressive liquor brands are stealing share, especially among the coveted young-adult demographic. As a result, beer has seen its piece of the total alcohol market fall to 48.8% last year from 56% of sales in 1999, according to the Distilled Spirits Council of the U.S. On another, craft brews, once a trendy badge for beer geeks, are now mainstream options for Joe Sixpack, a development that has contributed to eight of the top 10 U.S. beer brands losing share at stores in the 52 weeks ending Aug. 11, according to IRI."

The story goes on: "The situation is grim, but not irreversible. The two big brewers still control 74% of beer-shipment volume in the U.S. by Beer Marketer's Insights' calculations. And with their massive scale and marketing machines, the companies have experienced early success with new brands meant to take on liquor and smaller craft beers. But before the beer industry can regain its buzz, it's important to understand the six-pack of hurdles it has in front of it."

Among the most important of these challenges:

• Taste. The story suggests that while mainstream beer companies have focused on going lighter and broad-based, craft brewers have gained share by being more focused on specific tastes, offering a range of darker and more complex brews.

• Advertising. Beer companies have been known for great ads, but that has been less the case in recent years, when they have largely come up with ads that are "lackluster."

• Women. Beer companies generally have not targeted women, and have portrayed them in less than complimentary ways in advertising. To grow their brands, mainstream beer companies have to find a way to appeal to women.

Published on: September 17, 2013

• The Boston Business Journal reports that Ahold-owned Peapod "has been adding pickup service at its Stop & Shop and Giant stores at a rate of two to six stores a week in recent months. The company started about a year ago with a Stop & Shop in Abington, and now has more than 80 locations, including 29 in Massachusetts, Peapod director of marketing Peg Merzbacher says. Four are being added this week, including one in Wayland, and the company expects to have 100 by Thanksgiving.

"We’re finding that it’s definitely growing our e-commerce sales, for sure,” Merzbacher says. “It resonates for people for whom home delivery might not have worked.”

Published on: September 17, 2013

• USA Today reports that early in 2014, China will replace Canada as Starbucks' "second-largest market, where Starbucks plans to open its 1,000th store sometime before the end of 2013. As it expands in China – where Starbucks announced the opening of two iconic, flagship stores on Monday – Starbucks is experimenting both with the interior and exterior designs of its new stores in a bid to appeal to Chinese customers ... For Starbucks, it's all about tapping into growth markets with room to run. The chain, which has more than 12,000 U.S. locations, now views China as its biggest growth market, which can help it taper the pace of domestic growth. By the end of this year, Starbucks will have 4,000 locations across China and Asia Pacific."


• Florida-based Riteway Sales and Marketing said yesterday that it is launching a fresh foods division, Riteway Fresh, to target the southeastern US. The company has hired Don Bishop, the former Eastern region vice president for Del Monte Foods as well as president of Tampa-based Bishop Targeted Marketing, to run the new division.

Published on: September 17, 2013

• PepsiCo reportedly has named Seth Kaufman to be its new VP-brand marketing. Kaufman is the former VP-general manager of the Starbucks Joint Venture, and before that was director-media strategy and investment for PepsiCo beverages.

Kaufman succeeds Angelique Krembs, who becomes VP-field marketing and innovation for North American Beverages.


• The Grocery Manufacturers Association (GMA), announced the appointment of Dr. Brian Bedard as Executive Director of the GMA Science and Education Foundation (SEF). Dr. Bedard is described as "a veterinarian, international agriculture and food safety specialist and senior manager with 30 years of experience in China, Southeast Asia, Africa, the United States and Canada .. More recently, he has been employed by the World Bank to manage international programs including the Global Food Safety Capacity Building Partnership, coordination of the global avian influenza program and evolving initiatives related to the prevention and control of diseases at the animal-human interface diseases in developing countries."

Published on: September 17, 2013

...will return.

Published on: September 17, 2013

In Monday Night Football action, the Cincinnati Bengals defeated the Pittsburgh Steelers 20-10.