business news in context, analysis with attitude

We got a number of emails regarding our story yesterday about 7-Eleven looking to challenge grocery companies. One member of the MNB community wrote:

I long for the old days of 7-Eleven. They started out as the place to fill in when you needed just an item or 2 and didn't want to travel to the supermarket. It seems they have an even more compelling reason for existence now, given the size of stores, the layouts designed to make us walk past aisles of teasers, and the inconvenience of parking. I went to 7-Eleven last night for milk and barbecue sauce (not some weird recipe- the milk was to drink and the BBQ sauce for the chicken). I couldn't help but be struck by the lack of "core" foodstuff, and the vast array of packaged goods- cookies, crackers, chips, sodas, beers, jerky, and few suspicious looking refrigerated foods. Rather than continuing to position themselves as the supermarket alternative, they are now no different than any gas station built in the last 10 years. So rather being a solution to the supermarket hassles, they have merely become another peddler of junk and packaged foods that bring them higher profits. This consumer's not happy.

Another MNB user wrote:

I guess I'm going to show my advertising roots here. The latest 7-Eleven ad campaign tells customers to, "Stop by...for everything you'll ever need".
Yet, on the front page of their new circular, they turn around and tell you..."Shopping carts. They're about the only thing we don't have that you'll ever need." Okay, so 7-Eleven has everything I'll ever need, but they don't have everything I'll ever need. An interesting advertising concept/campaign if there every was one.

The very basics of Advertising 101 cry out against what 7-Eleven is doing here. The "Raphel Report", put out by Raphel Marketing (an MNB sponsor), deals with this very concept in its March 2004 edition headlined: "Under Promise and Over Deliver". One example that Murray Raphel gives in dealing with this subject is about a very successful businessman from Maine by the name of L.L. Bean. When asked about success, Mr. Bean had this to say,
"Make sure the story isn't better than the store." It looks like 7-Eleven may have overstepped their bounds in their latest attempts to change the concept of what the convenience store is all about in the mind of the consumer. Let's face it, even Wal-Mart can't (and I suspect wouldn't) make the claim that they have "everything you'll ever need". I know they're working on it, but they still aren't there yet. Beware the unsubstantiated advertising claim!

Regarding the ongoing battle between management and labor, which will continue to play out in markets across the country, one MNB user wrote:

About the only way to get the union & the grocery cos. to come to their senses is to make the people calling for the strike to go without their pay just like the people on the picket lines. Burd & his counterparts in the other companies should have to go without pay unless they are actually involved in negotiations.

And another MNB user added:

This issue of union verse non-union seems to be popping up all over. Is it time that unions have played to many cards and need to be dealt out? I'm believing more and more that unions have served their purpose. Times change and so must we. Many companies that are non-union have just as many benefits for the employee's as union shops. They can purchase health care at less expensive means for one. They don't have the expense of dealing on many issue with the unions, which can mostly be settled at company level. The total cost of having a union shop just appears to be out of the competitive level needed to get the business or customers. Again have the unions outlived their need??? I truly believe so.

Regarding our castigation of former US Foodservice CEO James Miller for looking to severance benefits that include country club memberships and use of private planes, even as Ahold employees lose jobs because of accounting issues that can be traced back to his management, one MNB user wrote:

Amen to your comments about Miller. The gall of that (expletive that I know you will delete) to ask for access to a private plane and country clubs when hundreds of Ahold associates are happy to have unemployment benefits at this point...and who gives a rat's (expletive deleted) about his ex-wife's health insurance when our Cobra payments can be as high as $1000 a month?!

But other than being offended and irate, I have a point. One of the things that so upset me about Martha Stewart's conviction is that she made $45,000 on that transaction. Not saying that what she did was right, but thousands of people didn't lose their retirement because of her actions. While Miller was asleep at the wheel, he sent Ahold into a death spiral.

Who really deserves jail and fines here? Miller should be hung by his fingernails while waiting for trial with his cronies.

And another MNB user wrote:

Too bad Martha is the scapegoat for every corporate leader (most of them men) who's done wrong recently.

Yes, she probably is guilty and she should be punished accordingly. But what about Kenneth Lay? Or any of the other guys we know are guilty of breaking the law and cheating the people and the system. What judgment do they get? How swift have their trial(s) been? Who's really done more harm here?

It would appear that we have a system that makes an example out of the least harmful white collar criminal so the public will forget about the other guys.

We're not sure that these cases are comparable - they're different in style, different in commission, different in result.

We keep hearing that Martha Stewart is being made an example of. (Which is different from being a scapegoat.) To which we respond, "Exactly." That's what the justice system is for.

We suggested that the person to pity in all this is Martha's potential cellmate…to which one MNB user responded:

Why? Martha's pretty good looking, and she's bound to keep the cell nice and tidy ... maybe some new curtains would spruce things up a bit.

It'd be our definition of hell.

On the subject of drug reimportation from Canada, one MNB user wrote:

People that don't believe the large drug companies are behind the attempts to keep us from getting our drugs from Canada are not reading MNB.

I buy 45 - 40mg Zocor US @ Costco $185.00 in Canada $70.00.

Another thing I don't understand about US drug pricing, the # of mg. in the pill doesn't seem to change the price any. 20, 40, & 80 mg. of Zocor are all the same. The same is true for 2 & 5 mg. of Hytrin.

The drug industry in the US is corrupt & has made most of our Representative & Senators corrupt.

MNB user Ben Irby wrote:

I felt a little sad today for the state of our health as a nation as I read the view of the person who spends $600 per month for medicine. I'm in my late 20's, and this is all it takes to keep me exercising and eating right. If more people would take the initiative to look after their health, and avoid having to take so many drugs, the re-importation issue would be a much smaller deal. I don't mean to be harsh, but every time they talk about this on the news it seems to be a profile of the same person. They show a person that is 50-100 lbs overweight, smoking a cigarette, with a Burger King bag on the coffee table talking about how bad off they are because they can't afford their drugs. While I know that there are a lot of people who have no control over their health ailments, I feel that the overwhelming majority of people are not taking responsibility for the fact that they have not taken care of themselves for 40 years, and no it's the governments fault that they can't afford to drug themselves back to health. I can see people all over the US, eating a big Mac and biggie fry's saying "That's why I didn't eat Salmon and Tuna in the first place, it causes cancer!".

I'll stop at that, but it's been eating away at me for a while. I will count my blessings tonight as I sit down to a meal of grilled farm salmon, steamed broccoli (organic), and a bottle of 1999 Miner Cabernet (if you have an opportunity to try it, it's outstanding).

Moral outrage and a wine recommendation. That's our kind of MNB user!

Strong analysis from a member of the MNB community:

Having spent a lot of time working on supermarket loyalty programs, the issue comes down to this – most supermarket execs want to sell things, not market to people. Loyalty market is about marketing to people and most significantly to the people who are important to your business. In a typical supermarket chain 20% of the customers (the best customers) produce 50% of the sales. The loyalty program needs to focus on these people first to “retain” them. Then the next 30% of the customers provide about 30% of the sales but generally do not use the store as their primary store. How do you move them to “primary”? The bottom 50% of the customers provide 20% of the sales and generally cannot be influenced but grocers spend huge dollars of markdowns selling them sale items.

Loyalty marketing requires focusing on customer groups and marketing to them, not selling them “things” or sending them coupons because a manufacturer funded them.

On the subject of obesity and nutrition issues, one MNB user offered:

What ever happened to sitting down to a good family meal, i.e. meat, veggies, potatoes, and a dessert, in MODERATION.

Seems that with all of the stress that everyday life puts on a person, we don't need to be told that everything that we eat is going to be a major contributor to our deaths.

People, LIFE is terminal. Lets just be intelligent about our serving sizes and push ourselves away from the table!

And another member of the MNB community suggested:

A friend of mine came up with what I believe can be the next great diet solution. It is called the “duct tape diet!” Just use duct tape literally on the offending parts of your body – your mouth or hands will work and bingo! Substantial weight loss!!!
KC's View: