business news in context, analysis with attitude

Published on: January 26, 2023

You may remember that earlier this week we had a story about how New Belgium Brewing is reformulating its flagship Fat Tire amber ale to what it is calling a "crisper golden ale" with some of the original's "flavor threads."  I'm not sure about the new formulation, but I do know this - based on the experience of one MNB reader (and fellow Fat Tire aficionado), they need to do some work on the customer relations front.

Published on: January 26, 2023

by Kevin Coupe

I know this has nothing to do with business and retailing - except in the sense that the world needs to exist for business and retailing to mean anything - but this story grabbed my attention and compelled me to share it.

CNet reports that the Doomsday Clock was reset this week, and now is set as 90 seconds to midnight.  This is the first time the clock's setting has been changed since 2020, when it was set to 100 seconds to midnight.

In other words, after two years of relative stability - and "relative" is the key word here - we've moved just a little closer to self-made oblivion.

CNet explains that "the Doomsday Clock is pretty much what it sounds like -- a clock assessing the world's dangers, and how close we are to self-destruction. A group of scientists who publish the Bulletin of the Atomic Scientists created the clock in 1947. And these aren't just any scientists -- the bulletin was founded by Albert Einstein, J. Robert Oppenheimer, Eugene Rabinowitch and University of Chicago thinkers who helped develop the first atomic weapons in the Manhattan Project. If anyone knows the dangers facing the world, they did."

Axios points out that the increased danger is connected to "heightened fears of nuclear war stemming from Russia's war in Ukraine as well as extreme weather events."

As I said, this has nothing specifically to do with business.  It is, however, a reality check.  And an Eye-Opener.

Have a good day.

Published on: January 26, 2023

From the Washington Times:

"A growing number of states have cut grocery taxes to relieve working Americans struggling with runaway inflation.

"Five of the 13 states that taxed groceries last year — Kansas, Idaho, Illinois, Tennessee and Virginia — have since passed laws reducing their cut from supermarket transactions. That cut ranges from 4% to 7%, depending on the state."

FMI-The Food Industry Association argues to the Times that "taxing food as prices rise creates unfair burdens for Americans who spend larger shares of their income on groceries."

“Grocery taxes are fundamentally bad public policy because they disproportionately impact lower-income families,” Andy Harig, an FMI vice president, says.  “More than three-quarters of states have now refused to tax groceries, and we are hopeful additional states will follow suit to provide families with much-needed relief.”

The Times writes that "as costs for food soar higher and faster than other items, lawmakers have increasingly clashed over repealing grocery taxes to relieve inflationary pain.

"Virginia Gov. Glenn Youngkin, a Republican, signed a bill last year to abolish the 2.5% grocery tax, fulfilling a campaign promise. This month, state Senate Democrats killed a GOP effort to repeal the local part of the tax, arguing that some towns may need the revenue."

In addition, "Last year in Kansas, Democrats led a bipartisan push to eliminate their state’s 6.5% sales tax but had to compromise with Republicans who wanted to phase it out more gradually. They ended up cutting the sales tax on food to 4%."

But a debate remains about whether the cutting of grocery taxes is enough to keep inflation at bay, and "efforts to cut grocery taxes have stalled … in the other eight states that have them — Alabama, Arkansas, Hawaii, Mississippi, Missouri, Oklahoma, South Dakota and Utah."

Published on: January 26, 2023

"Organic fresh produce sales grew by 3 percent in 2022, while volume declined by –3.7 percent, as total sales topped $9.4 billion for the year," according to the 2022 Organic Produce Performance Report released today by Organic Produce Network and Category Partners.

"Total fresh produce sales gained 7.3 percent in dollars for the year but experienced a –1.3 percent decline in volume. Organic fresh produce made up 12 percent of all fresh produce sales and accounted for 7 percent of all fresh produce volume."

The report also says that "the organic fresh berry category (which includes strawberries, blueberries, raspberries, and blackberries) was the top organic produce category, holding more than 16 percent of organic fresh produce dollars in 2022. Overall fresh berry sales topped 1.6 billion for the year, with organic packaged salads a close second at $1.55 billion."

“In an inflationary time like this, we expect to see the growth of sales dollars and volume declines repeated for the majority of organic and conventional fresh produce items,” said Tom Barnes, President of Category Partners. “The average conventional price per pound grew by 9.2 percent compared to 2021 while organic produce price per pound rose by 7 percent. With rising prices, we may see more selective organic shopping from consumers as they substitute higher-priced organic items for conventional ones.”

Published on: January 26, 2023

•  Business Insider reports that Amazon lawyers are warning employees "about sharing confidential company information with ChatGPT," the new artificial intelligence chatbot that has gotten enormous attention recently.

According to the story, "Amazon employees want to use it for work because it improves productivity."  But, "OpenAI, the maker of ChatGPT, is not transparent about how it uses confidential company information."

The story says that "a senior corporate counsel at Amazon" has suggested that Amazon employees "follow the company's existing conflict of interest and confidentiality policies because there have been 'instances' of ChatGPT responses looking similar to internal Amazon data.

"'This is important because your inputs may be used as training data for a further iteration of ChatGPT, and we wouldn't want its output to include or resemble our confidential information (and I've already seen instances where its output closely matches existing material),' the lawyer wrote.

"The exchange reflects one of the many new ethical issues arising as a result of the sudden emergence of ChatGPT, the conversational AI tool that can respond to prompts with markedly articulate and intelligent answers. Its rapid proliferation has the potential to upend a number of industries, across media, academics, and healthcare, precipitating a frenzied effort to grapple with the chatbot's use-cases and the consequences."

Published on: January 26, 2023

•  From Axios:

"The U.S. economy grew at an annualized 2.9% rate in the final months of 2022, the Commerce Department said on Thursday.

"Why it matters: Economists are bracing for a significant slowdown in economic activity as the Federal Reserve's interest rates hikes take hold, but that certainly wasn't the case in the final months of last year.

"Economists expected the Gross Domestic Product figures to show the economy grew at a 2.6% annualized rate last quarter, after expanding at a 3.2% pace in the prior quarter."

Axios notes that "the first half of 2022 was dogged by fears that the economy had entered a recession, after back-to-back quarters of contractions. But by the second half of the year, the economy had returned to growth mode.

"The growth over 2022 was an expected slowdown from the 5.9% achieved in 2021, when the economy bounced back from the pandemic shock."

•  The World Health Organization (WHO) has renewed its call for the global elimination of the use of trans fats in foods.

Here's what it said:

"Five billion people globally remain unprotected from harmful trans fat, a new status report from WHO has found, increasing their risk of heart disease and death.

"Since WHO first called for the global elimination of industrially produced trans fat in 2018 – with an elimination target set for 2023 – population coverage of best-practice policies has increased almost six-fold. Forty-three countries have now implemented best-practice policies for tackling trans fat in food, with 2.8 billion people protected globally.

"Despite substantial progress, however, this still leaves 5 billion worldwide at risk from trans fat’s devastating health impacts with the global goal for its total elimination in 2023 remaining unattainable at this time.

"Industrially produced trans fat (also called industrially produced trans-fatty acids) is commonly found in packaged foods, baked goods, cooking oils and spreads. Trans fat intake is responsible for up to 500,000 premature deaths from coronary heart disease each year around the world."

“Trans fat has no known benefit, and huge health risks that incur huge costs for health systems,” said WHO Director-General, Dr Tedros Adhanom Ghebreyesus. “By contrast, eliminating trans fat is cost effective and has enormous benefits for health. Put simply, trans fat is a toxic chemical that kills, and should have no place in food. It’s time to get rid of it once and for all.”

•  DC Velocity reports that the Consumer Brands Association (CBA) has endorsed "a bipartisan bill launched in Congress today that aims to deliver “a sweeping overhaul of the interstate trucking supply chain system” by bringing more drivers into the sector.

"According to its sponsors, the 'Safer Highways and Increased Performance for Interstate Trucking (SHIP IT) Act' would increase safety and shipping capacity for truckers; provide recruitment and retention incentives for drivers; and include flexibility during times of emergencies or black swan events. It was introduced by U.S. Representatives Dusty Johnson (R-S.D.) and Jim Costa (D-CA).

"If successful, the bill would follow a flurry of transportation-related bills that became law in the first two years of the Biden Administration, including the Bipartisan Infrastructure Act, Ocean Shipping Reform Act (OSRA), and Inflation Reduction Act. In additional moves, the White House introduced efforts to boost truck driver job recruitment, improve data sharing among supply chain partners through the FLOW platform, and forced a resolution to a threatened freight rail strike."

•  From Bloomberg:

"Mexico’s proposed changes to a planned ban on imports of US corn are insufficient, the Biden administration warned, saying that it continues to consider all of its rights to respond under the free-trade agreement between the nations.

"'Mexico’s proposed approach, which is not grounded in science, still threatens to disrupt billions of dollars in bilateral agricultural trade, cause serious economic harm to US farmers and Mexican livestock producers, and stifle important innovations needed to help producers respond to pressing climate and food security challenges,' the US Trade Representative’s office said in a statement."

In 2020, Mexico "announced plans to phase out genetically modified yellow corn for livestock feed by early 2024," the story notes.

Published on: January 26, 2023

We had a story the other day about a poll suggesting that while ;people were cutting back on day to day expenses, they still want to indulge in occasional luxuries, which prompted MNB reader Rich Heiland to write:

I used to use a statistic about Millennials in one of my presentations about finding and attracting markets. The study pointed out that Millennials were not buying homes. Urban Millennials were not buying cars. They were flexible. They were renting for the most part and selecting places near friends, work, other places of interest. And, they were renting small. But, and this was the point, they were using their spendable income to put really good stuff in those small spaces, and for recreation.

In urban areas they used public transit and ZIP cars. Of course the study was an early one and I’d assume many of those folks did change housing as they aged, started families. And, it did seem to have an urban focus. But my point was that cutting prices is not a great way to attract a market and it may cost you market share. By the way, my wife and I have downsized from a golf course home into a two-bedroom apartment and we spend on quality and on the experience.

I completely agree with you, though I suspect that some of the trend lines have been affected by the pandemic.  But I think the long-term trends will be in line with what you are sketching out.

Got the following note from MNB reader Rick Brindle about our Innovation Conversation, which focused on the two-part MNB interview with Boxed CEO Chieh Huang:

Great talk! Terrific insights. Two great minds with OG e-comm experience! 

Chieh is a friend. I sure hope he and his team comes out on top of Boxed.com's current opportunities. I'm no longer close enough to the situation but am betting that if anyone can figure it out, it's Chieh. 

High praise .., since Rick Brindle is the very definition of OG when it comes to e-commerce.

On another subject, I got this email from MNB reader Georgia Case:

Good thoughts, Kevin, on Frieda and Frieda's. She was my best friend and I was lucky to have known her. It's inspiring that we can continue to pass along her endearing qualities that made us better and in turn we make others better. She had a contagious personality!

Interestingly we were about 40 years apart but honestly I think she was younger in thought and sensibility.

I know what you mean.

We took note the other day of stories about how marketing decisions made by Mars Inc. about its M&M brand advertising have caused a cultural kerfuffle, leading to a move away from its animated "spokes-candies" in commercials and hiring of comedian Maya Rudolph for a new campaign that will be launched during Super Bowl LVII next month.

The New York Times wrote that "the characters, which have featured in the company’s ads for decades, were not weighing in on abortion or the storage of classified documents. But figures on the political right, including Tucker Carlson of Fox News, have criticized the candy as 'Woke M&M’s,' owing to a series of cosmetic tweaks in recent years … 'M&M’s will not be satisfied until every last cartoon character is deeply unappealing and totally androgynous,' Mr. Carlson railed on his show. 'Until the moment when you wouldn’t want to have a drink with any one of them. That’s the goal. When you’re totally turned off, we’ve achieved equity. They’ve won'."

I commented:

The thing is, there are things in the world worth arguing about.  There are things in the world worth fighting for.

But something else is true.  Which is that some people will fight and argue about stupid stuff just because they like the fight, not because the core disagreement is particularly meaningful.  These aren't necessarily stupid people, just people who like to create chaos for fun and, often, profit.  (Who, exactly, even thinks about having a drink with or being turned on by an animated candy character?)

To meet, the kind of shoes that animated candy characters wear, or what color these animated candy characters happen to be, fits the definition of not worth noticing, much less arguing about.

One MNB reader responded:

This is indicative of the world today – focusing on stupid things that don’t matter and acting offended to get attention.   Meanwhile, Rome burns. 

And MNB reader Aaron Algazy wrote:

“There is no such thing as bad publicity."

If people are talking about it, it’s making an impression on them and others.  Getting people like Tucker talking about it gets about half the country listening.  Then when the other half finds out “they” agree or disagree, the other half will disagree or agree.  

Personally I think having a real live spokes person rather than an animated spokes ‘thing’ is better for humans.  And I’m sure that the animated M&M’s are still going to be around.  Mars has too much invested in them.  

I don't think that the old trope, "there is no such thing as bad publicity," really works anymore.

Just ask George Santos. 

(Too soon?)

The fact is that the viral nature of publicity - good and bad - these days makes it harder to control.  And stupidity - which I think the work that best describes this debate about M&M's - gets a far brighter spotlight than I think it can handle.

Published on: January 26, 2023

As I mentioned a couple of weeks ago, MNB has initiated a new sponsorship tier that reflects what I think is a new approach to the topic - I've decided that I really want to forge sustained relationships with companies that have value propositions and missions in which I believe .. and that, in turn, believe in MNB's value proposition and mission.  My goal is to not just provide a forum for these "charter sponsors," but also commit to helping them grow their businesses in a variety of ways.  In other words, it ain't just about banner and tile ads.  It is about moving the needle forward in terms of innovation and, ultimately, service to the shopper.

Today, I'm happy to welcome Robin Russell Executive Search as an MNB charter sponsor.  I've known Robin for a long time, along parallel tracks. First, through my knowledge of her recruitment work in the retailing industry, in which she has delivered unparalleled results for companies and the executives she has placed. And second, when she guested at a marketing class I was teaching at Portland State University, proving that she is as comfortable talking to young people at the beginning of their careers as she is working with CEOs.  In addition, she's been an invaluable sounding board for me as I've grown my business.

So I'm thrilled that she wants to be part of the MNB family - I know that she delivers superb service and results to her clients, and I hope we can be instrumental in helping her get more of them.