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The New York Times' dependence on its online games - Wordle, Connections, Mini, and more - to enlarge its subscriber base has paid off enormous dividends.  And I think it offers retailers a good lesson in how to engage with and stimulate their customers.

by Kevin Coupe

I've been doing this a long time.  Over the years, I've had numerous conversations with industry folks about the places they believe have the best food cultures.

London.  Paris.  Milan.  Japan.  These are the kinds of names that often come up.

But Moscow?  Never.

At least, not until last week when Tucker Carlson went on social media site X to rave about the quality of Moscow supermarkets.

“Coming to a Russian grocery store, the heart of evil, and seeing what things cost and how people live, it will radicalize you against our leaders,” he said in the video. “That’s how I feel, anyway — radicalized.”

Carlson found the technology that required people to use a coin to get a shopping cart - which is returned when one returns the cart - to be remarkable.  He seemed dazzled by an escalator that handled shopping carts.  And fresh bread?  A fantastic innovation, he suggested.

Of course, the fact that he was so impressed by things that have existed in US supermarkets for decades made his suggestion that in Moscow, groceries cost 25 percent of what they cost in the US, somewhat suspect.  Largely because his bedazzlement suggested that he doesn't go to the supermarket very often.

As the New York Times noted, "Russia has more than twice the rate of inflation as the United States, and its citizens spend a higher percentage of their household budgets on groceries."

Now, to be clear, the claim that Russia has some nice supermarkets appears to be legitimate.  In The Atlantic, writer Graeme Wood had the following observation:

"In 2019, I visited several large and small Russian cities, and I went grocery shopping at least once in each. Would you believe that Tucker Carlson is on to something? In Moscow (the largest) and St. Petersburg (No. 2), the flagship supermarkets are indeed spectacular. The Azbuka Vkusa branch next to the Ministry of Foreign Affairs in Moscow is more luxurious than any grocery store within 100 miles of Washington, D.C. Other branches in Moscow vary in quality, and they are usually smaller than American supermarkets. But to some extent that’s just a matter of culture: The U.S. has fewer supermarkets, but each one is big enough to feed the 82nd Airborne Division for a month; in Europe, supermarkets are more numerous but tiny."

(Gee, I wonder why a Moscow supermarket next to a government building is nice.)

Wood also writes:  "Japan and Thailand have fine grocery stores, and I wonder, when I enter them, why entering my neighborhood Stop & Shop in America is such a depressing experience by comparison."  (Maybe he should try Wegmans or Stew Leonard's.  His local Stop & Shop may not be the best measure of state-of-the-art grocery shopping.)

But to suggest that somehow the food shopping experience and the accessibility of plentiful fresh food throughout Russia, on average, is superior to that in the United States strikes me as misguided at best, and deliberate misinformation/disinformation at worst.

That said, the Carlson visit to Moscow seems to be losing credibility and currency with every passing hour.  Even US politicians and pundits on the right were critical of his fawning "interview" with Russian President Vladimir Putin, and late last week, the world's eyes were opened with the sudden death of Putin’s most vocal domestic opponent, Aleksei A. Navalny, in a prison north of the Arctic Circle.

Note to Tucker Carlson.  All American supermarkets aren't great, but most of them are as good and Eye Opening a measure as any of the degree to which America is a great place in which capitalism has thrived, where good jobs are available and communities are served, and diversity of food and cuisine can be made available to everybody.

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Walmart this morning released its final results for Q4 and the just completed fiscal year, saying that Q4 revenue was $173.4 billion, up 5.7 percent from the same period a year ago.  Q4 operating income was up 13 percent to $7.3 billion.

US same store sales for the quarter were up four percent.

Global e-commerce sales for the quarter were up 23 percent.

Total annual revenue for the fiscal year was $648.1 billion, up six percent from the previous year.  Operating income for the fiscal year was up 32 percent to

 $27 billion.   US same-store sales for the year were up 5.6 percent.

Global ad sales for the year were up 28 percent top $3.4 billion.

In its analysis, the Wall Street Journal writes that

"Shoppers are spending less per trip to Walmart for the first time in over two years, a sign that prices are cooling in some categories along with inflation at the country’s largest retailer."  Growth in same-store sales, the story notes, was "driven by more visitors, not higher purchase prices."

Walmart also said Tuesday it agreed to purchase TV maker Vizio for $2.3 billion, "a deal it hopes will be a major boost to its growing advertising business."

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Seeking Alpha has a piece about a new survey suggesting the impact that the use of Ozempic-type weight loss drugs could have on consumer expenditures.

Three key findings from the study:

•  In a survey of consumers, 12.3 percent of respondents said that someone in their households was taking a GLP-1s weight loss drug such as Ozempic or Wegovy.

•  "Before beginning treatment, GLP-1 HHs spent over $150 more a month on average on groceries when compared to non GLP1 HHs," though not all of it because of an individual who eats more than others - there also are issues of larger household size and higher income.

•  Once a household member begins using one of the Ozempic-style drugs, monthly grocery spend seems to decrease anywhere from six to nine percent.

KC's View:

The Ozempic economy, as some have called it, is something with which food retailers are going to have to reckon.  For the moment, it appears that these drugs are having a real impact on people's health and nutrition, which will factor into how much they spend on food.

The impact almost certainly is going to be greater as the drug becomes less expensive and more available, not to mention covered by insurance companies (which it should be since it likely will save them money down the road).

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Colorado Public Radio reports that "a union representing workers at local grocery stores filed unfair labor practice charges against grocery store chains Kroger and Albertsons on Thursday because of an alleged illegal 'no poaching' agreement between the two chains.

"The complaint was filed by UFCW Local 7 with the National Labor Relations Board. It came a day after Colorado Attorney General Phil Weiser filed a lawsuit asking Denver District Court to block a proposed $24.6 billion merger between the two chains. In that lawsuit, Weiser revealed that a yearlong investigation by his office discovered an alleged agreement between the two grocery companies to not hire each other’s employees."

In a statement, the union said it was “dismayed to learn through AG Weiser’s Complaint that Kroger and Albertsons entered into an unlawful agreement during Local 7’s 2022 strike against King Soopers … 'Despite what these companies might say publicly about their motivations or the professed positives of this merger, their actions show otherwise,' President of UFCW Local 7 Kim Cordova said in a release. 'The leaders of these companies cannot be trusted to do right by their employees or customers'."

Of course, not every employee appears to feel that way.

The Oregonian reports this morning that "a labor union that represents thousands of grocery workers at Fred Meyer, Albertsons and Safeway stores in several Western states has endorsed a proposed merger between their parent companies.

"United Food and Commercial Workers Local 555 on Monday announced its support of the proposed $24.6 billion deal between Kroger, the parent company of Fred Meyer and QFC, and Albertsons, which also owns Safeway."

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The Boston Globe has a piece about "CVS rage," which it characterizes this way:

"CVS, how do we hate thee? Let us count the ways:

"We dread thine long pharmacy lines, that sometimes end in frustration, with a stressed-looking employee rooting around aimlessly for a bag with your name on it, or informing you that your prescription, which was $8, is no longer covered by insurance, and if you want to challenge the new price tag, 'You can speak to the pharmacist.' (Unless the pharmacist is on strike, as they were last fall, along with pharmacists at Walgreens and Rite Aid, to protest working conditions and understaffing.)

"We loathe thine self-service kiosks, barking their robotic commands: Scan item now touch the continue button if finished. Please remove all bagged items. Please wait system is processing. If you have your extra care card please scan it now. Please wait help is on the way.

"We are thrust into despair by thine grim lighting, and prison commissary-chic decor, in which thee have locked the Sensodyne and Rogaine behind bars and made even the holiday candy seem sad.

"Customer service needed in aisle two. Customer service needed in aisle two."

KC's View:

Brilliantly written.  And, I think, pretty accurate.

CVS argues that it is investing in both its store experiences and people, and that the complaints that the Globe is hearing are merely anecdotes that don't reflect customer satisfaction.

I think that's B.S.

I've been arguing here for months years that many CVS stores are barely mediocre shopping experiences that reflect badly on management and suggest that the company has no business trying to extend its footprint in the healthcare business.

I would suggest that before CVS tries to do anything else, it should try to get retailing right.

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Target has announced the launch of its new "dealworthy" private label that it says "features low prices on nearly 400 everyday no-frills basics, providing incredible value on apparel & accessories, essentials & beauty, electronics and home items — from laundry detergent and toothbrushes to undergarments, paper plates and more — without sacrificing quality for the price … dealworthy items will continue to roll out through 2024 and into early 2025."

Rick Gomez, Target's executive vice president and chief food, essentials and beauty officer, said in a prepared statement:  “With the introduction of our newest owned brand, dealworthy, consumers can shop hundreds of everyday basics at incredibly low prices, without sacrificing quality for the price. We know that value is top of mind for consumers, and dealworthy, backed by our owned brand promise, will not only appeal to our current guests but position us to attract even more new shoppers to Target.” 

CNN writes that "the entrance of Dealworthy means a shakeup of two other Target budget-focused brands that it produces: Smartly and Up&Up. The former, which largely focused on household essentials like soap and trash bags, will be discontinued and replaced by Dealworthy items … Up&Up, another affordably priced Target brand, is getting a redesign and will be priced slightly higher than Dealworthy. Those products, which span 2,000 items from toothbrushes to now dog grooming supplies, have been upgraded to meet 'higher quality standards' and cost less than $15, Target recently announced."

KC's View:

Here is a pic of the new private label brand:

I have no idea whether this move will be successful for Target, but I have to say that the look is very reminiscent of how generics were marketed 40 years ago.

Maybe that's retro.  Or maybe it is just dusting off an old idea and hoping that it can work.  Again. 

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Intriguing piece in the Boston Globe over the weekend about how something is changing at Logan Airport there.

Taxis are making a comeback.

According to the story, "Nearly a dozen travelers told the Globe recently they found cabs less expensive, more convenient, and more reliable than ride shares. And they liked that cabs typically don’t charge 'surge pricing,' where prices jump during high-demand times."

The story goes on:  "While still well below pre-pandemic levels, taxi pickups at Logan have climbed steadily since hitting bottom in 2020, according to Logan operator, the Massachusetts Port Authority. In 2023, taxis logged more than 1 million pickups at the airport, up 5 percent from the year before but nearly double from 2021. That upswing stands in sharp contrast to the trend pre-pandemic, when taxi ridership fell to about 1.5 million airport pickups in 2019 from nearly 2 million in 2017.

"Ride shares, to be sure, remain far more popular than taxis, with the airport seeing nearly 3.6 million ride share pickups last year. Not only were those higher than in 2022, but above pre-pandemic figures, as well."

KC's View:

One of the problems that taxis face, it seems to me, is that they exist in a fragmented industry - there are lots of operators and drivers, and they don't really work together as an industry in a consumer-facing way.  Uber and Lyft, on the other hand, have a more cohesive and coordinated narrative.  And, the rides can be a lot more pleasant, in nicer cars.

But if the people and companies in the taxi business could tell their story more effectively, speaking with one compelling voice, they could start to erode the market share gains made by the ride share companies.

Narrative matters.  Consistency matters.  For the taxi business, and for every shopper-centric business.

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The Washington Post reports that "after George Floyd’s murder in 2020, companies made big pledges about racial equity, hiring teams dedicated to diversity, equity and inclusion. Now corporate America is pulling back — cutting DEI jobs and outsourcing the work to consultants.

"DEI jobs peaked in early 2023 before falling 5 percent that year and shrinking by 8 percent so far in 2024, according to Revelio Labs data shared with the Washington Post. The attrition rate for DEI roles has been about double that of non-DEI jobs, says Revelio, which tracks workforce dynamics … Corporate America’s retreat from DEI has coincided with increased legal risk and political animosity toward systemic efforts to boost racial equity. State legislators have introduced at least 65 anti-DEI bills since 2023."

The Post rites that "the recalibration is happening under serious legal pressure. Last year, when the Supreme Court struck down affirmative action in college admissions, the decision didn’t apply directly to employers. But the ruling kicked off an effort, driven largely by conservative activists, to dismantle race-conscious policies in other domains of American life."

However, the Post writes, "Some companies are bucking the trend. J.M. Smucker, Victoria’s Secret, Michaels, Moderna, Prudential and ConocoPhillips were among big corporations that expanded their DEI teams by 50 percent or more in 2023, according to Revelio’s data. Packaged-food giant Conagra Brands and NASA both doubled the size of their DEI teams."

KC's View:

I've made this argument here before - that it strikes me as a positive when companies endeavor to create workplaces what reflect the demographic realities of their customer bases, and the country.  Sure, diversity means people with different skin colors and of different genders.  But the real diversity is in life experience, in upbringing, in attitudes and sensitivities.

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With brief, occasional, italicized and sometimes gratuitous commentary…

•  From The Information:

"The European Commission said on Monday it had opened 'formal proceedings to assess whether TikTok' had breached the Digital Services Act on various grounds … The EC said it would focus its investigation on whether TikTok’s algorithms were design to 'stimulate behavioral addictions and/or create so-called ‘rabbit hole effects’.' It added that the Digital Services Act requires companies to offset addiction risks with age verification tools to stop children using its systems.

"The investigation comes just a few weeks after the CEOs of TikTok and other social media platforms appeared before a Senate hearing to discuss actions they took to prevent young people being harmed by their platforms. TikTok CEO Shou told the hearing that TikTok users have an average age of 30."

Not sure about the legal restrictions, but I think addiction is pretty much the goal of every social media company.  Maybe not stated, but certainly implied.  

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•  MarketWatch reports that "Grocery Outlet Holding plans to acquire Southern value grocer United Grocery Outlet for $62 million.

"The Emeryville, Calif.-based company said that the deal would come with 40 stores and a distribution center and would expand Grocery Outlet’s presence into Tennessee, North Carolina, Georgia, Alabama, Kentucky and Virginia … Grocery Outlet expects the deal to close early in the second quarter.

"The company said it also plans to open 15 to 20 stores in existing markets in 2024, in addition to the acquired stores."

•  From National Public Radio:

"Milk, eggs, walnuts and peanuts — this is not a grocery list, but some of the food allergies that could be more easily tolerated with a newly approved drug.

Xolair, developed by Genentech, was greenlit by the Food and Drug Administration on Friday to help reduce severe allergic reactions brought on by accidental exposure to certain foods. It is considered the first medication approved by the FDA that can help protect people against multiple food allergies.

"The medication is not intended for use during an allergic reaction. Instead, it is designed to be taken repeatedly every few weeks to help reduce the risk of reactions over time. The FDA said people taking the drug should continue to avoid foods they are allergic to."

•  From the Associated Press:

"Two years after California launched an effort to keep organic waste out of landfills, the state is so far behind on getting food recycling programs up and running that it's widely accepted next year's ambitious waste-reduction targets won't be met.

"Over time, food scraps and other organic materials like yard waste emit methane, a gas more potent and damaging in the short-term than carbon emissions from fossil fuels. California's goal is to keep that waste from piling up in landfills, instead turning it into compost or biogas.

"Everything from banana peels and used coffee grounds to yard waste and soiled paper products like pizza boxes counts as organic waste. Households and businesses are now supposed to sort that material into a different bin.

"But it has been hard to change people's behavior in such a short period of time and cities were delayed setting up contracts to haul organic waste due to the pandemic. In Southern California, the nation’s largest facility to convert food waste into biogas has filed for bankruptcy because it’s not getting enough of the organic material."

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I got the following email from an MNB reader about the decision by the CDC to relax covid-related guidance:

Those of us who disagree with the CDC read the peer reviewed science. We know that the effects of multiple covid infections are cumulative. You may be okay after your fourth infection, not so after your fifth (40-80% of infections are asymptomatic). RAT tests are discussed and the word is getting out to test poop when the RAT test is negative but you feel crummy. We have read the studies relating a covid infection to a 25% chance of dementia (the Brazil study) with each infection. We know that the studies have shown that Covid is a vascular disease that increases people's chances of a heart attack and/or stroke. Long Covid is a part of our lexicon and we know that kids can get it. Most of us still mask in either an N95, K94, KN94 or flo mask. Some of us even mask outdoors because we know that you can be within six feet/two meters of someone, even outdoors. We know that immunity is an illusion for an ever changing virus. 

Corporations are being hit by multiple absences and schools lack teachers and/or students on any given day. Thus, the CDC guidance. Yes, some places have improved the air, but not enough to warrant dropping quarantining after an infection.

"Corporations are not going to have enough people to program the robots if Covid is not taken seriously. The actions by the CDC are negligent and will have long term consequences."

Didn't see that one coming.

Also received some nice notes responding to my faceTime video last week about how my life took an unexpected (but not unwelcome) turn.

One MNB reader wrote:

Amen, Brother. Just celebrated our 50th Anniversary and lived all of it in Upstate NY in the snow belt. Thankfully in the world of semi-retirement we’re stationed in Palm Harbor, FL until the end of March. The adoption of technology that enables working remotely is one of the silver linings of COVID.  

Not much of my current situation was planned for or even considered in my younger days, but like you, it’s more than I could of ever asked or imagined. (Nod to St. Paul).

It is embarrassing for a former altar boy to admit this, but I had to look up St. Paul to see what he is the patron saint of - and it ends up that he is the patron saint of "missions, writers and publishers."

Go figure.

From another reader:

i grew up in Paramus, NJ with a dream to one day serve in Washington, DC, and the ball was rolling in that direction until I fell in love.

One dream replaced the other - it happens.

From the Reverend Dr. Martin Luther King, Jr.:  

"Love is the greatest force in the universe.  It is the heartbeat of the moral cosmos.  He who loves is a participant in the being of God."

I noted last week that spring training has begun, which prompted one MNB reader to write:

What I miss, is when owners held their team players intact for many seasons. Can we refer to them as “The Holdovers?”

I miss pitchers hitting.  But life goes on, and I've learned to live with it.

Another MNB reader wrote:

Major League Baseball is a sport played entirely in front of a lynch mob.

I'm not sure what that even means.  (The only time I ever worried about a lynch mob at a baseball game was when my son and I went to a Phillies home game, and listened to all the fans around us kvetching about the Mets - who weren't even playing the Phillies that day.  Phillies fans can be an angry bunch, I've found.)

And then, this email from MNB reader Jesse Sowell:

We share an appreciation for detective stories, movies, and baseball, among other things. Reading your note today on spring training reminded me of this quote, I think from the late Jim Murray of the LA Times:

"Pitchers and catchers report, and hope springs eternal." 

At this time of year, every team is tied for first, and even fans of last year's last place team can find reasons to believe that this will be their year. It's a magical time for baseball fans.

Finally, I did a FaceTime last week about how low birth rates and low fertility rates are teaming up to make life difficult for disposable diaper manufacturers, which are turning to adult diapers as a way to bolster their businesses.

I mentioned that Mrs. Content Guy came up with a great name for an adult diaper line - "Dignity."

Which prompted this email:

Sorry Kevin and Mrs. Content Guy, but the name is already patented and used on adult diapers.

The bad news is that before doing that piece, I'd never heard of Dignity adult diapers.  But the good news is that I really don't know the names of any adult diaper lines.

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