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Thursday, July 30, 2009

Unilever gets all the trans fat out of its margarines

Unilever, which sells more tubs of soft margarine spread than anyone, will unveil Monday plans to remove all partially hydrogenated oils — artificial trans fats — from its soft-spread brands, including I Can't Believe It's Not Butter and Shedd's Spread Country Crock.

The change, to begin next month and be done by the second quarter of 2010, signals how serious the marketing and technology battle about trans fats in foods has become. Shoppers have increasingly demanded that foods they buy — from baked goods to snacks to margarine — no longer carry artery-clogging trans fats that can lead to heart disease.

"I call this the death knell for trans fats," says Marion Nestle, professor of nutrition at New York University.

The elimination of trans fats from the U.S. diet "should be written up as a business school case and studied," says Michael Jacobson, director of advocacy group Center for Science in the Public Interest, which has pushed for it. Trans fats have been reduced more than 70% in three years, he says.

Unilever (UN)(UL), which makes half the spreads sold in the U.S., already can claim "zero grams" of trans fat in its spreads, which also include Brummel & Brown and Imperial.

Food and Drug Administration rules let foods with less than 0.5 grams of trans fat per serving be labeled "0 grams of trans fat."

But consumer demand and pointed marketing by Smart Balance, Unilever's closest rival in soft spreads, nudged Unilever to go lower. It will no longer mix in even tiny amounts, which added texture and shelf life. The new label, for the first time, will boast: No hydrogenated oils.

Unilever will replace the partially hydrogenated oils with a mixture of palm oil and interesterified fat (plant oil). All four of its spread brands will then have only 0.05 grams per serving of trans fat, the minute amount that occurs naturally in vegetable oils.

The change could kill a very effective ad campaign by Smart Balance that relentlessly needled Unilever's spreads, and others, for adding partially hydrogenated oil.

Wednesday, July 29, 2009

Macy's tailors stores, including new Fairview location, to match local tastes

Terry Lundgren is the guy who took away your local department store, turning it into another link in the Macy's chain. Now the company CEO wants to give it back with a program he calls My Macy's.

After a pilot program to match merchandise to local shoppers' preferences in 20 Northern markets, Macy's Inc. is introducing the strategy to the rest of its 69 markets, including those in Texas. This summer, all 808 Macy's stores received the local treatment.

A store that's opening next week in Fairview, north of Dallas, is one of three 120,000-square-foot stores built from the My Macy's perspective. There's no fine china department, but women's accessories, sportswear and cosmetics have been bumped up. Without a bridal registry department, more space is given to bed and bath and to kitchen utensils.

In San Tan, a suburb of Phoenix, another new Macy's doesn't have a dress department. The third store, opening next week in the Kansas City suburb of Lee's Summit, has a "brow bar" in cosmetics, where customers can get their eyebrows professionally shaped.

The Fairview Macy's also has a Starbucks with seating, Wi-Fi and three computers available for customers to check e-mail or place orders on It also has dressing rooms with interior lounge areas so mothers and daughters can consult outside of a tiny room.

The new stores are the culmination of 18 months of research by 30 people in operations, design and merchandising to create "a store from the customer's point of view," said Karen A. Meskey, Macy's senior vice president for store planning and design. She said the building design, which the three stores share, is "prototypical instead of a prototype," because it allows the space to be allocated differently. Higher ceilings in center areas are intended to convey the grand hall feel of traditional department stores built in earlier eras. Macy's new box comes with a new corporate structure that looks to the past for answers, back before department stores began shedding shoppers, locations and familiar names in the 1980s.

The recession has been especially challenging, as shoppers look to discounters to stretch their dollars. But at some point, the recession will end, said Lundgren, who lived in Dallas in the early 1990s when he was CEO of Neiman Marcus.

"Companies like Macy's will emerge even stronger," he said. "This is the time it pays to take risk. There's no resistance to trying new things; everyone is anxious to stimulate sales and get the customer shopping again."

Lundgren took heat from local markets when he led the creation of a national department store chain of more than 800 stores with the Macy's brand in 2005 and 2006, assembled from romanticized regional names such as Marshall Field's in Chicago, Rich's in Atlanta, Burdine's in Florida, Foley's in Houston and Meier & Frank in Portland, Ore. Macy's acquired 11 regional brands in its 2005 merger with May Department Stores.

The result was a redundant mishmash. Thirteen divisions were consolidated first into seven, then into four huge divisions, with buyers in Atlanta, for example, deciding what to put in Pittsburgh. It wasn't working.

So Macy's management started with "a blank sheet of paper," Lundgren said. In February, Macy's began consolidating into one central organization. The Cincinnati- and New York-based company cut 7,000 jobs, or 4 percent of its workforce, and reassigned 1,600 merchants to live where customers shop.

Lundgren said the talent was all there; the merchants just had to be moved to be "national as well as locally responsive."

Macy's now has a team of 20 district merchants and planners in each of its 69 markets. Each team is responsible for 10 stores.

The people they report to are in eight new regions, based in Chicago, Houston, Miami, Los Angeles, New York, Pittsburgh, San Francisco and Washington, D.C. Lundgren told them to follow one general rule: "When in doubt, just say yes."

Local empowerment of the My Macy's teams creates a "sustainable competitive advantage," Lundgren said. "Having 10 stores per district, there's continuity, with merchants in the stores every day talking to the customer. The power behind that is unbelievable."

In the fourth quarter of 2008, sales in My Macy's pilot stores were 1.5 percentage points higher than those of the other stores, Lundgren has told Wall Street. In the first quarter of 2009, that gap widened to 2.1 percentage points.

Investors are reserving their opinions, as it's hard to judge much of anything while the recession handcuffs the consumer.

Citigroup analyst Deborah L. Weinswig has a "hold" rating on Macy's shares and said in a recent report that "an undertaking of this scale has significant execution risk."

But she said the effort could be a long-term positive, along with customer insights from dunnhumbyUSA, a consumer research firm that Macy's hired a year ago.

There's "no other logical reason" for My Macy's test stores in Chicago, Detroit, Pittsburgh and Columbus, Ohio, to perform better than the rest of the company, Lundgren said.

Gerry Frank is a Macy's convert. His family founded the Oregon stores that operated for almost 150 years as Meier & Frank, and he initially tried to fight off Macy's. But Lundgren won him over then and with the local strategy now.

"This is the proper thing to do at this time. The Dallas customer and the Portland customer are very different," Frank said. "They've come full circle."

Wednesday, July 15, 2009

Economy alters purchasing habits even for wealthy

Upscale U.S. Consumers Adjusting Food Demands During Recession
July 14, 2009
In the midst of an economic downturn, even more affluent U.S. shoppers are reconsidering grocery and foodservice purchases, according to “Premium Consumers in the New Economy: Food and Foodservice, a recent report from New York-based market research publisher Packaged Facts.A more adventurous taste in food, higher health and nutrition consciousness, firmer preferences for organic and natural foods, a heightened sense of ethical consumerism, and a greater propensity for Internet and coupon use are the attributes for an increasing number of premium U.S. consumers. Such psychographic responses to financial change have reshaped -- and will continue to alter -- consumer spending on food, the report found.“The economic turmoil that reached crisis level in fall 2008 has been a bull in the china shop of American consumer behavior, even for a market as fundamental as food,” noted report author David Sprinkle. “Consumers who have been set back or thrust forward financially are more likely to be rethinking what they need, what they want, and how and where best to find it.”The report found that the direction of financial change matters less than the fact of financial change in molding consumer mindsets. Therefore, upscale consumers who have taken a financial hit often align in attitudes and behavior with those on the financial upswing, as opposed to those whose finances have remained stable.Packaged Facts defines premium consumers as either single-person households with an income of at least $75,000, or multiple person households with an income of $100,000 or higher. The premium designation accounts for the top 28 percent of adults, or about 61 million out of 222 million adults. As of first quarter 2009, over twice as many adults in the premium group thought they were worse off (vs. the year before) than thought they were better off.Economic hardship is leveling the shopping playing field, according to the report. Upscale consumers, although still less likely than other consumers to shop at Walmart Supercenters, are, however, switching to Walmart at above-average rates. Specific segments of premium consumers (such as Gen Xers) are opting for less expensive fast food, particularly the better-for-you varieties. And premium consumers use coupons more, not less, than the rest of the population.“Premium Consumers in the New Economy: Food and Foodservice” is the latest installment in Packaged Facts’ ongoing examination of consumer responses to the shifting economy. For further information, visit

Wednesday, July 8, 2009

Microsoft produces PepsiCo's biggest online campaign

LONDON - PepsiCo has appointed Microsoft for the first time to produce its biggest online campaign.

The deal, brokered by Claudia Lagunas, head of international marketing for PepsiCo, is Pepsi's largest online commercial partnership to date.
The campaign will run for nine months and will initially include a Pepsi Max microsite in the UK, Norway and Australia targeting 18 to 25-year-old men.
The Pepsi Max's "Club" microsite has been built and is being hosted using Microsoft technology.
Fronted by Australian soap Neighbours pin-up Holly Valance, it aims to engage users with the brand by allowing them to share comments, games and photo galleries with friends on social networking sites such as Facebook and Twitter, encouraging them to join Pepsi Max's Club.
Microsoft's portal MSN will host specially created editorial content, which Microsoft has guaranteed will drive at least one million people to the microsite.
Microsoft Advertising will also drive consumers to the microsite through ads around its MSN Messenger service.
Bruno Gruwez, marketing director UK Beverages at PepsiCo, said: "We wanted to make sure we were in the digital space as that's where our consumers are and we will continue to increase investment in the digital space.
"The deal with Microsoft is a way of adding value and we will continue to expand our partnership with them."

5 successful product positioning brands

7-Up. The famous positioning of 7-UP as the “Uncola” perfectly positioned that product for those who did not want to consume cola drinks. For those who do (a confirmed Coca-Cola fanatic), the positioning of 7-UP had no appeal. But that’s fine, since I am not their prospective customer anyway (even though THEY might consider me a prospect).- Courtesy of Steven “sbhoward” Howard
Starbucks. I’ve been critical of Howard Schultz the turnaround CEO, but Howard Schultz the entrepreneur franchised “premium coffee,” forever upgraded the “coffee shop” experience, and created one of the world’s most powerful brands in the process.
Swatch. The most famous example I can think of is Swatch. Created as a defense against low priced Japanese quartz watches that swamped the market, instead of competing on price, [parent company] SMH positioned the product as the famous “fashion watch,” thereby creating a whole new market, much larger in size than the original watch market.- Courtesy of Ricky ” rdewerk” de Werk
Hyundai. Another fantastic example is Hyundai, a company that understands how to consistently move upstream through intelligent product positioning. Hyundai is increasingly creating havoc in the market for their competitors and finding ways to innovate, and develop value propositions that resonate with their customers and prospects.- Courtesy of Mikah “MikahDC” Sellers

Monday, July 6, 2009

Soma Beverage Introduces Natural Mint Water

Some of the flavors include Peppermint, Spearmint and Lemonmint

Soma Beverage has introduced natural mint water that combines pure water and real mint. It is available in 6 varieties, namely-Peppermint, Spearmint, Cherrymint, Lemonmint, Orangemint and Chocolatemint.
The company claims that Metromint provides a cooling sensation and is a refreshment to beat the summer heat. Real mint stimulates the brain to open the senses and send cooling sensations throughout the body. The mint in Metromint stimulates the senses, soothes the stomach and restores the mind. More importantly, it sends cooling sensations throughout the body, which is why company is targeting style and health-conscious consumers.
Scott Lowe, President of Soma Beverage, said: "Metromint is the perfect way to cool down during the hot summer months. All six mintwater varieties are made with pure water, and absolutely no sweeteners, preservatives, or calories. Metromint is this summer's coolest beverage."
Each variety of Metromint is designated with a numerical chill factor. From Chocolatemint (-2 degrees) to super cool Peppermint (-9 degrees), the chill factor is a comparative scale that measures the range of minty refreshment.

Coke turns to new packaging in crowded beverage market

ATLANTA - For most of us, the shape of a 2-liter bottle is something we take for granted.

For Hendrik Steckhan, head of carbonated soft-drink brands for Coca-Cola North America, the shape is a problem. Coca-Cola should not be in the same 2-liter bottle as every other brand, he said.
“When you think about this, it just doesn’t make sense,’’ Steckhan said.
Faced with a nagging decline in North American sales, Atlanta-based Coke and its bottlers are turning to packaging as a key way to set their products apart and try to generate fresh appeal.
Consumers will see more sizes and bundles of Coke products at supermarkets and convenience stores. The iconic contour shape also will become even more prominent. A 2-liter contour bottle, already in Birmingham, Ala., and Chattanooga, Tenn., is being added to Atlanta in July.
The push for what’s called “package diversity’’ is significant, and the stakes are high.
Across the industry, US sales of carbonated soft drinks have declined for four straight years, according to figures from Beverage Digest, a New York-based trade publication. PepsiCo, Coke’s chief rival, also is using packaging, including new logos and different package sizes, as part of a strategy to revive soft-drink sales.
For years Coke has relied on a wide range of package sizes overseas. It can easily be found in more than a dozen can or bottle sizes.
The North American market, by contrast, is dominated by three packages: a 2-liter straight-walled bottle, a 12-pack of 12-ounce aluminum cans, and a 20-ounce plastic bottle.
Coke executives attribute the difference to a highly competitive US market where Coke and Pepsi have battled for decades.
“There was a point in time when value was defined as more - more ounces for less [money],’’ said Ralph Kytan, vice president of Coke’s North American bottling operations.
Coke hopes to rewrite the value equation.
“Package diversity is about matching up the benefits of the package with the needs of the purchaser for the occasion they’re buying for,’’ Kytan said.
At convenience stores, the 20-ounce is the top-seller, but its price of more than $1 has hurt sales. A teenager looking for a more affordable option might grab a 16-ounce bottle priced at 99 cents, Steckhan said.
At the grocery store, the 12-pack and 2-liter are the top sellers. But the 50-ounce twin-pack might be more appealing for smaller families, he said. One bottle can be shared for a meal, leaving the other unopened and fresh for the next meal.
Coke also has high hopes for its 2-liter contour, Steckhan said. The original contour glass bottle was created in 1916 to help Coke stand out from the pack.