business news in context, analysis with attitude

Published on: February 11, 2015

by Kevin Coupe

NBC News yesterday announced that its evening news anchorman, Brian Williams, has been suspended for six months without pay for having made a series of misstatements over the past 12 years that inflated and misrepresented his experience while covering the war in Iraq. It was reflective of the impact of social media in our society that the misrepresentations came to light because soldiers who actually were there objected to Williams' statements; when he apologized, it was too little, too late, and only exacerbated his situation.

It was late last year that Williams signed a new five-year contract reportedly worth ten million dollars ... which suggests that the suspension will cost him somewhere around a million bucks, not to mention the respect of his peers and viewers.

Ironically, Williams' suspension probably lost some of its news value yesterday because of another media story that almost instantly superseded it - that Jon Stewart, the host of "The Daily Show" for more than 16 years, has decided to leave the program later this year. There will be plenty of time to evaluate Stewart's contribution to the culture ... his satiric chops, his willingness to interview unknown authors about esoteric subjects, and his ability to identify and highlight the talents of some pretty amazing comedians - John Oliver, Stephen Colbert and Steve Carrell are just the two most obvious examples.

But what really makes Stewart special, I think, is his ability to hook into the zeitgeist - to instantly understand not just what people want and need to know, but also the level of skepticism that they'll accept and already feel about various institutions. The New York Times refers to it this morning as tapping into viewers' "inexhaustible exhaustion" with politics and government ... it seems to me that one of the things that Stewart shares with his audience is a burning desire for a less dysfunctional system, for less hypocritical and cynical politicians on both sides of the aisle, and for simple common sense.

I consume a lot of media, and here is a basic reality of my life. It doesn't matter to me at all who anchors any of the traditional TV news programs on any of the networks. But I already miss Jon Stewart and am dreading the day that he no longer hosts "The Daily Show." And when the history of this media era is written, I suspect that Jon Stewart's name will be a lot more important than Brian Williams'.

That alone, I think, is an Eye-Opener.

Published on: February 11, 2015

PWC is out with its annual global consumer survey, "Total Retail: Retailers and the Age of Disruption," concluding that "the physical store remains the retail touch point with the highest frequency, driving retailers to transform in-store experiences with differentiated storefronts that turn stores into ultimate shopping destinations."

According to the survey, "only 27 percent of U.S. consumers say they shop online weekly. Reserving the strength of the traditional store, 68 percent of U.S. respondents say they have intentionally browsed products at a store but decided to purchase them online, while 73 percent say they have browsed products online but decided to purchase them in-store. Sixty-five percent of the respondents noted delivery fees as the reason for purchasing in-store, as well as having the item immediately (61 percent), and trying it on/seeing it (61 percent)."

The survey suggests that there are form essential forms of disruption - mobile technology, social networks, shifting demographics, and the tailoring of the physical store so it conforms to the demands of a digital age - that create a complex environment that retailers to navigate "as consumers continue to develop their own approach to researching and purchasing products, both online and in-store."

"For the past several years, the story around retail stores was 'showrooming,' in which stores were places to display items for online purchase. However, this year's survey results reveal that the online shop has also become a showroom where shoppers research and compare prices for later, in-store purchases," says Steven Barr, PwC U.S. retail & consumer practice leader, in a prepared statement. "As online shopping continues to grow at the expense of store visits, we expect the premium in the future may be on creating unique, brand-defining store and online experiences that keep consumers coming back."

Published on: February 11, 2015

The Alliance for Natural Health, an advocacy group, has attacked the New York State Attorney General for accusing a number of nutritional supplements for deliberate mislabeling of products, including not having ingredients in the products that are listed on the label. Those accusations led to the state demanding that four major retailers stop selling the products.

The press release from the Alliance reads, in part:

"The supplement ban was issued based on a single unverified test, performed by a scientist who usually studies lizards, using completely inappropriate technology - and new tests show that the original testing was wrong ... The NY attorney general’s cease-and-desist letters to four national-chain retailers, charging them with selling nutritional supplements that were 'deliberately mislabeled' and 'potentially dangerous to public health,' has created a firestorm of media attention - all of which is completely unwarranted. Now one of the retailers, GNC, has proof from new tests that the products contain precisely what the labels claim.

"AG Eric Schneiderman said that the products did not contain the herbal compounds that were advertised on their labels. However, he took these actions on the basis of only one testing technology from only one laboratory, performed by a scientist whose work centers on the evolutionary genetics of reptiles. The test he used, DNA barcoding, is a technology that is quite appropriate for determining the DNA of lizards and snakes, but is utterly inappropriate for testing supplements. In many commercial extraction processes for herbs, little or no DNA is extracted—so the test will assume, falsely, that the herbal compound is missing because its DNA isn’t present.

"DNA barcoding has been shown to be inaccurate by botanical scientists and is not the standard utilized by the FDA in determining if products are appropriately labeled. Even scientists who are generally critical of nutritional supplements, such as Dr. Pieter Cohen of Harvard Medical School, agree that the wrong test was used."

Published on: February 11, 2015

The Washington Post reports this morning that the Dietary Guidelines Advisory Committee, described as "the nation’s top nutrition advisory panel," plans to reverse its previous concerns about the consumption of cholesterol-laden food.

The story says that "the group’s finding that cholesterol in the diet need no longer be considered a 'nutrient of concern' stands in contrast to the committee’s findings five years ago, the last time it convened. During those proceedings, as in previous years, the panel deemed the issue of excess cholesterol in the American diet a public health concern.

"The finding follows an evolution of thinking among many nutritionists who now believe that, for healthy adults, eating foods high in cholesterol may not significantly affect the level of cholesterol in the blood or increase the risk of heart disease.

"The greater danger in this regard, these experts believe, lies not in products such as eggs, shrimp or lobster, which are high in cholesterol, but in too many servings of foods heavy with saturated fats, such as fatty meats, whole milk, and butter."

The change in attitude does not mean that people don't have to be worried about so-called "bad cholesterol" in their blood, which can lead to heart disease. But "the change on dietary cholesterol ... shows how the complexity of nutrition science and the lack of definitive research can contribute to confusion for Americans who, while seeking guidance on what to eat, often find themselves afloat in conflicting advice."

Published on: February 11, 2015

It was the kind of story that, ordinarily, might make it into MNB's FastNewsBeat section - Heinz announcing that it is bringing out a new ketchup flavored with sriracha, the hot chili sauce with roots in Thailand.

But then there was a story from the Los Angeles Times noting how sriracha "has catapulted from a cult hit to flavor du jour, infusing burgers, potato chips, candy, vodka and even lip balm," but that "David Tran, a Vietnamese refugee who built the pepper empire from nothing, never trademarked the term, opening the door for others to develop their own sauce or seasoning and call it Sriracha."

And Tran apparently doesn't care.

"Tran, who now operates his family-owned company Huy Fong Foods out of a 650,000-square-foot facility in Irwindale, doesn't see his failure to secure a trademark as a missed opportunity," the Times writes. "He says it's free advertising for a company that's never had a marketing budget. It's unclear whether he's losing out: Sales of the original Sriracha have grown from $60 million to $80 million in the last two years alone."

The story goes on to say that "He believes all the exposure will lead more consumers to taste the original spicy, sweet concoction — which was inspired by flavors from across Southeast Asia and named after a coastal city in Thailand. Tran also said he was discouraged to seek a trademark because it would have been difficult getting one named after a real-life location."

Published on: February 11, 2015

Reuters reports that Walmart plans to spend the equivalent of $269.16 million (US) "to boost its presence in Canada this fiscal year," spending on 29 new supercenters and expanding several stories to include grocery departments.

The move seems to be a direct result of Target's decision less than a month ago to close all its Canada stores and abandon an expansion plan that turned into a debacle.

Published on: February 11, 2015

• Pymnts.com reports that "Taco Bell’s new mobile app is cooking, posting sales at 20 percent higher than in-store orders ... The brand’s high digital orders are due in part to consumers’ preferences of purchasing additional ingredients through the app."

The story goes on: "The mobile ordering app heavily plays on personalization capabilities, as Taco Bell finds that 70 percent of its consumers already customize their orders. Users can also pay within the app with a credit, debit or gift card, and can select pick-up location to be at the drive-thru window or in store."

Published on: February 11, 2015

• The Associated Press reports that Kraft Foods is going to switch the formulation of its Capri Sun line, switching out the high-fructose corn syrup and replacing it with sugar, which will have the added benefit of reducing the per-drink calories from 60 to 50.

According to the story, "Capri Sun sales have fallen for the past three years, according to Euromonitor International. Packaged food makers have come under pressure to position their products as more natural or wholesome, in line with changing tastes."


• At the National Grocers Association (NGA) Show in Las Vegas yesterday, two grocers were named winners of its "best of show" Creative Choice Awards in the Marketing and Merchandising categories. The Best of Show in Marketing was awarded to County Market, Quincy, IL, which partnered with Mondelez to offer a unique contest to give away tickets to see the world-famous boy band One Direction. And the Best of Show in Merchandising was awarded to Coborn's, St. Cloud, MN, which designed a large-scale food drive that took place the entire month of October in all stores.


• In Minnesota, the Star Tribune reports that Supervalu "is overhauling its Wild Harvest store brand. The Wild Harvest private label, available only in Supervalu-affiliated stores, will get a packaging refresh, and its line-up of 300 products will be expanded by nearly 200 this year ... Wild Harvest products are free from more than 100 artificial and synthetic ingredients, and nearly 70 percent of its products are certified as organic."

Published on: February 11, 2015

• Crain's Chicago Business reports that MillerCoors CEO Tom Long has announced his retirement, effective June 30. The company said that Long's departure, after four years in the job, is voluntary, "personal decision to spend more time with his family."

Published on: February 11, 2015

On the subject of increased competition in the Minneapolis/St. Paul marketplace, one MNB user wrote:

I would agree that the MSP market has some of the finest grocers as well as some excellent meat markets and smaller independents.  I am not sure why everyone wants to take on that competition.  Hy-Vee could have had Chicago had they pursued some of the Dominick's locations.




Regarding the proposed classification of the internet as a public utility, one MNB user wrote:

I have not researched this subject (yet) so I don't know all the pro & con arguments relating to this issue. But there are some indicators for us to consider. Let's see where this might be headed. 

If it is a public utility:(1) it could be taxed; wow, that would be a surprising development; (2) Congress could pass laws relating to this; another possible surprise is that it might lead to lobbying and that might lead to campaign donations.

The benefits of the public utility solution seem to be overwhelmingly favorable. Who will be among those treated most favorably?




MNB reader Joe Luehrmann had some thoughts about Jack in the Box, which says it is investing in a better burger (which I thought was barely mediocre):

I have not been to Jack in the Box since they poisoned their customers years ago.  If you cannot trust a food operator to practice proper sanitation standards, why would you ever go back?  I had encountered a number of undercooked JITB hamburgers as it was the only place open at night in my St. Louis neighborhood.  Several friends also complained about the sanitation.

So you're saying that I'm not missing anything by not having a Jack in the Box anywhere near me?




In a piece/rant about nutritional supplements the other day, I commented:

Let's also be clear about something. I'm not sure anyone has said that all nutritional supplements are useless and/or mislabeled. Just a percentage. (Like maybe 50 percent?) Albeit a sizable enough percentage requiring regulatory attention.

(There's an interesting intellectual exercise for you. How "sizable" is "sizable enough" to create regulatory interest and consumer outrage? What's the number? Five percent? Ten percent? Two percent? Just curious...)

Which prompted one MNB user to write:

Regarding percentages, I was told that 0% is the best measure.……ie; What would you think id 95% of the time you turned on your lights everything was O.K. but the other 5% there was. chance you would be electrocuted. Would you install that switch in your home?

Exactly.

Somehow, folks in the nutritional supplement business have turned lack of transparency and a sense of mystery into an advantage.




On another subject, one MNB user wrote:

I read your recent posting on Brian Williams, my comments have nothing to do with the fabrication of the story…..I think he will not survive the story…but a line in your story caught my eye...

“A salesman at a men's clothing store there once told me that Williams was an incredibly nice man who could afford to spend a lot more on clothes than he did. That means something, though I'm not exactly sure what.)”

You asked the question, that means something though you were not exactly sure what. I thought about how we are constantly bombarded by story after story about how American have not saved enough money for retirement and many of us are in for a rude awakening.

I think if more people were like Brian and did not spend as much as he can afford to, we would be in better shape as country. Living below one means is a trait that I believe is lost in our culture. Now granted much easier for Brian to live below his means ( his means are much higher than the average Joe) but how many people do we know that are making a lot of money but do not have two dimes to rub together in their savings.

Of course if the many American that are spending at or above the means…then I guess I economy would take a hit but in the long run we might be better off.




Regarding the passing of former Kings CEO/ chairman Allen Bildner, one MNB user wrote:

Allen Bildner was class & manners and possessed a keen ability to relate to everyone he met.  A gentleman in the truest sense of the word. The world was a better place with him and fortunate are those who had met him.  Just a great guy.




I took note the other day about how the Jeb Bush sort-of campaign for the GOP presidential nomination has hired former Walmart exec Bill Simon to hire staffers to shape policy positions, and suggested that he needs to do better than Ethan Czahor, the founder of hipster.com who was named the Bush Campaign's CTO ... and who, it has been revealed, used Twitter in the past to make observations that seemed to use "slut" as a synonym for "woman."

One MNB user wrote:

I saw your comment about the Jeb Bush plan to run for President.  Regardless of how anyone feels about Bush, you set yourself up for critical backlash when you devote so much space in your response to another name with no connection to Bill Simon former WMT CEO.  Maybe I am uniformed since I’ve never heard the name you mentioned.  Are you implying that Bush picked another bad choice?  You come off sounding like a Bush hater, I doubt you intended to give that impression.

First of all, there was no backlash.

Second, I was not expressing any opinion about Jeb Bush's candidacy.

However...while you may not have heard about Ethan Czahor, the fact is that his name was very much in the news and his Tweets had gone viral. And I have very strong opinions about the fitness of this guy to serve in any sort of public policy capacity.

I don't care that he was just out of college when he made these comments, nor that he made the comments four or five years ago. It is, in my view, inexcusable - it suggests a world view that I find to be abhorrent, and a significant character flaw that, to be honest, likely still exists. He's apologized and deleted the tweets, but my guess is that he's mostly sorry he got caught.

This doesn't make me a "hater." It just makes me a barely enlightened male who has a daughter, sister, and wife ... and who understands that there is no place in public or private discourse for these sorts of people and opinions. And I don't think I can devote too much space to this discussion.

Breaking News: As I was posting MNB this morning, it was announced that Ethan Czahor has resigned from the Bush campaign.




Finally, responding to yesterday's piece about a NYC church taking Walmart to court over gun sales, one MNB user wrote:

I’m so tired of reasonable people like yourself having to preface pieces like this by acknowledging and nearly apologizing to America’s “gun culture.”

There have been 104 school shootings since Newtown and still the rules around purchasing arms and ammo online, at retail or from the trunk of someone’s car, have not been significantly changed. There have been very few improvements in preventing those who have been diagnosed as mentally ill from buying firearms and ammunition in bulk.  Rarely does a week go by that we don’t hear about a child— or toddler—shooting a family member. And still we’re all trying to not offend the gun culture?

Any objections to potential changes made to waiting periods and restricting the mentally ill from access has nothing to do with hunters and everything to do with the fact that the NRA has bought our leaders from both parties while frightening the “gun culture” into buying more guns and renewing their NRA memberships.

I'd like to think that I was acknowledging the gun culture that exists in much of the US ... but I don't think I was apologizing. There are those who would suggest that I was risking offending them just by bringing it up.

But I get your point. And agree with all of them.

I know how I feel about this issue. I felt that way before Newtown, and the fact that the Connecticut elementary school where my wife teaches has been turned into a high-security facility has done nothing to alleviate those opinions. Not acknowledging the fact that there are cultural differences, though, strikes me as ignoring the only path to any sort of reasonable compromise.