Squashed: Hunt’s GMO Claim Buries New Ad Campaign

Hunt’s is an iconic American brand, perhaps known best as the number two brand of ketchup next to Heinz, released a new advertising campaign this past Monday. The after-Christmas marketing and advertising direction poised to take them into 2017 and it features a field of tomatoes with the voice-over: “No GMOs in sight”.

The campaign, on the surface, might seem rather benign to the average consumer. However, the campaign and the inference that Hunt’s products used non-GMO tomatoes was met with swift resistance by those in a variety of areas of expertise.

The issue being: that there are no GMOs in tomatoes that are sold to consumers in any form in the United States. The claim by Hunt’s (parent company ConAgra Foods) is now being viewed as the company trying to essentially trick the American consumer into thinking that the competition uses or contains GMO ingredients.

Furthermore, the campaign by Hunt’s is being seen as a way to capitalize on the American consumer and their inherent aversion to GMO containing food products. In the essence of the situation here, the bottom line is that it looks dishonest by the company that they are making a claim about GMOs when all tomatoes are free of the ingredients that would met a standard definition of being genetically altered or modified.

The consumer, farming, and scientific communities have all taken to social media and squashed Hunt’s for the implication that their ingredients are free of GMOs, when it would be true for the entire market. The other issue at play here is that if they planned on changing their label to reflect a “non-GMO” status, that type of change to the packaging and label deck costs money, and it is usually passed along to the consumer in the form of a price increase.

The campaign has smacked so much of utilizing public fears over GMOs that some social media comments have consumers saying that they will be buying the competition’s products because of what Hunt’s tried to insinuate in this campaign.

It would be ridiculous if Heinz had to issue a campaign or a statement regarding the GMO status of their tomato based product lines. This is a case study for a marketing and advertising campaign that has gone totally sideways from the original intent because it was not thought all the way through. It was ill-advised by Hunt’s and it is definitely misleading to the consumer, but it was not in a malicious way.

The topic of GMOs is a hot button for many, myself included, and I have written my share of pieces on all sorts of topics relative to GMOs in the past. The article I did on Campbell’s Soup and their decision to disclose genetically modified ingredients on their individual product labels has certainly sparked a backlash against their products. I have witnessed it in the soup aisle and with the reaction of those people I know regarding their soup products.

In fairness to Campbell’s, as I noted in my prior article, the staple crops in making some of their soups: corn, soy, and sugar beet are sourced from the supplier as GMO containing ingredients. This is due to the supply chain of our staple crops containing GMOs or being grown with GMO seed. The amount of organic crops of those staple items is far too limited to sustain a mass production supply level and would also be very cost inefficient at this point.

The case of Campbell’s differs from Hunt’s because the ingredients involved in making soup do have non-GMO alternative sources, in the case of Hunt’s the product is already GMO free and they were trying to pass it off as it was a decision that they had consciously made about their products.

In the end analysis, honesty is always the best policy. Hunt’s would have been better served by focusing on the facts such as: “the tomato, GMO free and always will be” or “ketchup the naturally GMO free way to give flavor to your favorite food”. The tact they took has left them in a tough spot, they have to course correct this marketing campaign or else they will be left trying to figure out what to do with all those unsold bottles of ketchup which was GMO free in the first place.

Rite of Passage: Walgreens, Rite Aid, & Fred’s Pharmacy Strike Deal

The retail pharmacy channel had an interesting week as we head toward the end of 2016, with the news that Fred’s Pharmacy chain is planning to purchase 865 Rite Aid store locations. This sale is motivated by the proposed merger between Rite Aid and Walgreens which I covered earlier in 2016.

A number of weeks ago the proposed merger was shifted to an early 2017 completion date because of some regulatory situations. The Rite Aid/Walgreens group decided to sell these locations in an effort to satisfy the Federal Trade Commission and some of their concerns over the potential monopoly the combined entity would have in certain geographic areas.

The exact locations of the Rite Aid locations being sold off to Fred’s Pharmacy has not been disclosed, and will not be disclosed until everything is finalized. The news yesterday had Rite Aid stock price jump 5% overall, and if the transaction is approved, the acquisition would vault Fred’s to the 3rd largest drug store chain in the United States.

Fred’s Pharmacy is a southeastern U.S. based regional drug store brand which also has a division of deep discount stores that compete with Dollar Tree and Dollar General. The company, according to financial news sources, is in the middle of a rebranding strategy to move away from being a discount retailer and shifting their focus to being a health and wellness focused drug store retailer. This transaction will provide them with a great opportunity to complete that type of rebranding effort. That was confirmed by the response in the stock market, with Fred’s Pharmacy shares jumping 81% at one point.

The Walgreens/Rite Aid group had to make some sort of move to divest locations to satisfy the anti-trust regulatory process. The reality in this market is that when you do a “channel check” on retail drug stores, Walgreens had just a few options to make a deal based on the current status in that market space currently. Then I read in Forbes that one of the top executives at Fred’s Pharmacy handled real estate transactions on locations for Walgreens in his most recent previous job, I started to understand the dynamics of this deal and how it was consummated.

The regulatory road has had some hurdles for Walgreens and Rite Aid because it will create a huge company of 12,000 store locations. The merger could benefit consumers because of the power they could possess for obtaining better drug prices from the pharmaceutical distribution companies. The merger could also be a negative for consumers because the company could set higher prices on other products leaving the consumer with little competitive options that could provide savings.

Fred’s is going to greatly expand their presence in the market with their investment of around $900 million to reinvigorate the company and help it to compete with larger regional and national marketplace players.

The deal makes sense for Walgreens/Rite Aid because their merger is estimated at over $9 billion and would completely reshape the retail drug store industry space in the U.S. if it is approved. The areas of health, beauty, and personal care are always in demand by the American consumer and that trend is not about to change anytime soon. Walgreens is planning on having the capability to provide all of those needs in a “one stop” shopping experience for the consumer.

This all bears watching as we will soon flip the calendar to 2017 and watch as the huge companies all get even larger through M&A activity.

(Some background information, statistics, and stock market data courtesy of CNBC, Forbes, and Yahoo! Finance)

Gone Fishing: L.A. Rams Fire Jeff Fisher

The Los Angeles Rams vaulted to the top spot in the sports news stream this afternoon when they announced they had made a head coaching change by dismissing Jeff Fisher after a 4-9 start to the 2016 season. The Rams lost their fourth straight game on Sunday and they had lost eight of their last nine games.

The reason why this move came as a bit of a surprise is that the team and Fisher had just recently confirmed that Fisher and General Manager Les Snead had both signed contract extensions (Fisher was given an extension through the 2018 season). The Rams owner, Stan Kroenke, spoke today about the firing of Coach Fisher and explained that the thought process at the time of the extension (which actually was signed before this season began) was to reward Fisher for making the transition of the franchise from St. Louis to their relocation this season to Los Angeles. The Rams are set to move into a huge new stadium facility in a few years and they thought Fisher could lead them into that stage in their progression in Southern California.

This season, however, was a spectacular failure for Fisher who has been dogged by on-field and off-field issues all season. The first issue was the decision to play Case Keenum at quarterback and bench the Rams top draft pick, Jared Goff, which then led to the media pressing Fisher about playing Goff. The team had traded future draft selections to move up to the top overall spot in the draft to select Goff and Fisher kept him on the bench.

When the media pressured Fisher about this situation, it was essentially discovered that he was against the decision to trade all of those future assets to move up to select Goff. The selection of Jared Goff was supposed to represent the future of the franchise in their new Los Angeles chapter, and that player was not in the plans for the head coach of the team, that was the first sign of trouble for Fisher.

Next, the play of the team after a surprising start, began to spiral downward. The players looked unfocused, and the play turned sloppy and undisciplined in all three phases: offense, defense, and special teams. The new fan base in L.A. grew weary quickly and called for Goff to get a shot at quarterback.

Coach Fisher, under what I would assume was intense pressure from the front office and the owner, relented and started Jared Goff. The situation went from bad to worse as the turnover ratio for the team ballooned and the Rams dropped their next four games. It was unfair to Goff too, since he had not seen the field at all, and then he is dropped into the middle of an already rocky season, and he is told to essentially learn the offense “on the go”.

The offensive woes continued with the Rams getting blown out by the Atlanta Falcons yesterday in front of a dwindling home crowd. The comments by running back Todd Gurley after the game are summed up by him calling the Rams “a middle school offense”, and in my opinion Gurley should not be saying anything to the media to criticize anything because his play has been well below the expectations, his performance has been terrible this season.

The offense is most probably a main reason why the decision to fire Jeff Fisher was made at this point because if the front office was lukewarm about keeping Fisher as their coach, the sooner they transition the new offensive scheme for Jared Goff to learn, the better off they will be in the long term. I have seen this with other teams and their young quarterbacks, the management wants to avoid having them learn multiple systems, and stability is needed for success.

Furthermore, Fisher had the whole ordeal with Eric Dickerson which unraveled off the field which became a huge distraction for the team. Dickerson is a Hall of Fame running back who was a staple of the L.A. Rams in their original run in Southern California before the team relocated to St. Louis in the mid-1990s.

Dickerson was seeking some on-field passes for himself and his friends, Fisher reportedly denied the request, and a rather vocal (at least Dickerson was) and public feud between the two men ensued. Fisher was never going to win a fight with a Rams former player that carries as much clout as Dickerson, so I knew this was going to be yet another “black mark” against Fisher.

The Rams were blown out yesterday by Atlanta, as I mentioned earlier, and with that loss Coach Fisher tied Dan Reeves for the most losses in an NFL coaching career in the history of the league. It was a matter of time before the hammer was going to drop on Fisher, I thought it was going to be after the season on that Monday where characteristically coaching changes are made.

In the interim, John Fassel, the son of former New York Giants head coach, Jim Fassel, will step in and guide the team. The Rams have a game on the road in Seattle on Thursday night, which also surprised many with the timing of this decision today, it is a short week for the team to prepare. This change being made at this point translates into a situation where reading between the lines it had to have been very rough behind the scenes over the past few days.

The aftermath beyond these last three games of the 2016 debacle of a season for the L.A. Rams is that the team with a multi-billion dollar new stadium being constructed along with a huge retail and entertainment district surrounding it, which is dubbed “NFL Disneyland” needs to make a big splash again. The Rams front office needs to hire a big name to replace Fisher. They need a big time offensive minded head coach to install a system that complements Jared Goff, who they have committed significantly toward being their franchise quarterback.
Those names are Mike Shanahan, Jon Gruden, and Jim Harbaugh. The plan, according to reports from ESPN, NFL Network, and others if Shanahan was hired his son, Kyle, would join him in L.A. and would take the reins as head coach in a few years.

The most intriguing name, whether you like him or not, is Harbaugh. In my own opinion, I do not think that Gruden has interest in leaving his very lucrative ESPN commentary job to coach again, or else he would have done so already. I would also have some concerns if I were the Rams about whether Gruden still had the fire to coach after being away from the sideline for so long.

The Rams roster is not very good and needs a lot of work to build toward a playoff contender, let alone a championship contender. I would think Gruden would be interested in a team that was closer to winning than one that will take a bit of rebuild before it can turn that corner.

Harbaugh, though, is a name that is going to gain traction because he has lived and coached on the West Coast with Stanford and the San Francisco 49ers, and he had great success at both stops. In his current situation at the University of Michigan there have been some significant bumps in the road in that situation because Harbaugh wants to do things his way, and Michigan has resisted completely handing him the keys to do so.

The Rams, if they were very aggressive, could pry Harbaugh away from his alma mater, especially if they put enough money on the table. The fact that Stan Kroenke is a billionaire and has a significant amount of resources dedicated to making the Rams a part of the fabric of L.A. again is leverage for the next coach to utilize as well.

In a related note, now that Fisher is dismissed, Eric Dickerson has stated that he will attend Rams games again, and for whatever it is worth, he just started following Jim Harbaugh on Twitter.

The Rams ownership and management made a bold push to the NFL to gain relocation into the coveted L.A. market before any other team, and their first season there has been a flop. They need to make another bold move by naming the right man to coach the team moving forward and transition this team into one that will capture the consciousness of the fan base in Los Angeles. They need to right this ship before it sinks completely.

NJ Devils: West to East Coast – The Road Ahead

The New Jersey Devils lost yet another game on the road last night to the Chicago Blackhawks in overtime. Since the teams reached the extra session, the Devils will earn a point in the standings for the overtime loss, but it still leaves an unsettling feeling for the fans. This 2016-17 Devils team has struggled on the road so far, and the reverse is also true: the team has been very strong on their home ice (7 wins, and only 2 losses – both in overtime) which has buoyed their overall performance.

There are some fans and local “beat” media types that are quick to point out that many of those games where the Devils performance has lacked are in games against top tier teams or teams with winning records, for the most part. They would also be correct in generalizing the effort of New Jersey being very resolute in many of those games, where they have battled to stay in those losing games rather than give up.

However, in my view, the fact that the Devils have played 14 games on the road this season and have won just 3 of those games and lost 11 times (7 in regulation and 4 in overtime), is a concern. I can concede that it is still early, there is a great deal of hockey still left to be played; but the reality is that these trends get entrenched and they are difficult for teams to turn around.

In addition, the team has been without star forward Taylor Hall who was out with an injury until his return last night to the action in Chicago. Hall does significantly impact the manner in which the team approaches the strategy to a given game. His ability to use his speed and skating ability to push the puck forward puts pressure on the opposing team and changes the way in which the Devils hold the zone offensively and transition the puck as well. That type of impact cannot be underscored. It obviously remains to be seen how a healthy and effective Taylor Hall as well as the health of other key players impacts the performance of the team on the road as the season moves forward.

The silver lining in the case of a tough team like Chicago is that the Devils will not have to play there again this season. The Devils also dealt with a trip to the West Coast already and subjected themselves to that gauntlet. The point being that they have put some of the more difficult road trips behind them.

It should also be noted that the Devils schedule is “back loaded” with home games in the second half, which if they play to their potential and are in the mix for a wild card playoff spot, they should be able to win several of those home games, so they figure to be well positioned in the long term.

Conversely, they have not played many Metropolitan Division opponents so far this season, so New Jersey has some difficult games ahead against teams in the top of the standings such as the New York Rangers, Pittsburgh Penguins, and the surprising Columbus Blue Jackets.

In addition, the Devils have several games remaining with the top teams from the Atlantic Division such as the Montreal Canadiens, Ottawa Senators, and Boston Bruins. It is going to be “tough sledding” until February where they have nine of their eleven games that month are at home at Prudential Center.

In the meantime, we will learn if Travis Zajac has found his scoring touch again after the hat trick last night. We will see how the new defensive pairings for this season hold up under the crucible of Metropolitan divisional rivalry games. We will see if the young Devils prospects can continue to contribute in the various facets of the game on a consistent basis.

The Devils have areas to improve and they have areas where they have been surprisingly better than anticipated, but that is not unlike many other teams at this point in a hockey season. It remains to be seen how the road ahead will treat New Jersey, but I know one thing: they have to figure out a way to win games away from Prudential Center, or else this season will be over before we know it.