Welcome to the Lempert Report LIVE.
Welcome to the Lempert Report LIVE.
Welcome to the Lempert Report Live. More than 10,000 Americans voted for the grocery retailers that they favored when they looked to save money– the winners, according to BrandSpark Most Trusted Awards are Aldi, H-E-B and Walmart. There are actually 8 categories beyond affordability– Store brands(Aldi was#1), in 4 categories, Store Brands, Fresh Produce, Quality Fresh Foods, and Enjoyable in-store experience H-E-B took the top spot in all– interesting that the 4 they topped are the 4 most important to shoppers. Well done H-E-B! Today a new twist on saving money on eggs, finally a step to stop organic labeling fraud, why you should pass on that next office party cake, why veganism might not be as easy as thought and the repercussions from Dry January. On the Bullseye– why the ratings of food need to stop. Let’s get started. So, Sally, let's talk about eggs. Eggs are in the news practically every day. But now there's a new service out there that's trying to save people money on eggs. It's called rented chicken. What, tell me about this.
Sally:It's a little bit more of a commitment than going to the supermarket and buying eggs, that's for sure. But, basically what you can do, this company is in Los Angeles, and they have this offering, this opportunity for you to rent. A chicken coop comes with two or three hens, comes with seven fertile eggs, a mini incubator. They deliver it, they set it up, they offer the lighting that you need to examine the eggs, and they give you a guide on how to take care of the chickens. So, what do you think Phil?
Phil:Well, you know, I, I go back to a story that we did a few years ago about a family that had chickens in their backyard in Long Island. And while it was approved by, you know, the city as far as, you know, having the right permits and so on, the neighbors were up in arms because the chickens and hens were making a lot of noise. You've obviously got the feces to deal with. I think, to be honest with you, I don't think it's a great idea. I wouldn't like to see everybody have, you know, their own chickens in their own backyards. The good news is that you could rent it for two to four egg producing hands for up to six months. It costs$575 for a six month rental for two. And also what's so interesting, on average, two chickens will produce eight to 14 eggs per week. Four will produce 16 to 28 eggs per week. There's also a regulation here in Los Angeles that says the chicken coop must be 35 feet from a neighboring structure and a hundred feet if you have a rooster, obviously that's because of the noise. Mm-hmm. Also what we're noticing here in California is that the farmer's markets, which are prolific here, are selling a lot of eggs. The average eggs right now in California, even though national average is about$3 and 50 cents here in California, they're up to about seven bucks. So a lot of these farmers market people are selling eggs, keep in mind that they're not refrigerated and eggs should be kept refrigerated. And they're selling'em for two to$3 a dozen less. The other thing that's going on in California, which I find hysterical, the biggest smuggling that's going on now over the Mexican border is about eggs. The US Customs and Border Protection officials are reporting a major spike in people bringing eggs into the country illegally from Mexico. You're not allowed to do that, by the way, by law. You can't bring in poultry, you can't bring in meat, you can't bring in eggs, but people are still doing it. A 30 count carton of eggs in Juarez, Mexico sells for$3 and 40 cents. So you get a lot more eggs for a lot less priced. According to this report, this is from N P R, just a dozen eggs in California are now priced as high as$7 and 37 cents if you get caught. So don't take eggs over the border if you can get caught. No. You know, they're gonna steal'em from not gonna steal'em. They're gonna confiscate them from you. But you can get fined$300, but by law, you can get a fine of up to$10,000. So you just don't wanna bring in those eggs no matter what they say. We've got some good news as it relates to organics. New regulations are being put in place to hopefully get rid of some organic fraud that we've seen over the past few years, especially when it comes to imported products. What's that about, Sally?
Sally:Well, Phil, apparently this is set to be implemented in 2024, and it is the first time that regulations like this, aggressive regulations have been implemented in about 20 years. So that's a long time that we've been buying organic foods. And nothing has really changed as far as those regulations. But now what they wanna do is they wanna stop fraud. A lot of this fraud is coming from seeds and grains that are used to feed livestock, meat that is raised to be organic or, or, you know, eggs that are raised to be organic eggs. And this is very important to consumers that they feel like they can trust that the product they are buying truly is organic. So there's gonna be some new regulations that are gonna require these operations to improve their record keeping. There's going to be unannounced inspections apparently, and the government will be training agents to handle that.
Phil:Yeah, I think it's great because especially as organics are so much more expensive. People, not to get ripped off, but the only problem that I take issue with, with this U S D A rule, I think it's great. I think it's important, but they're only saying that they're gonna be able to do spot unannounced inspections for 5% of the operations every year. So 5% of the operations being inspected, I think we're still gonna have a lot of people who want to cheat.
Sally:Yes. That is a very small number, and I think it's really important for these brands that have organic products to be communicating to their consumers, you know, what their story is, where their food is coming from, where it is made, how it is made so that consumers can feel comfortable buying, trusting their brand. And, you know, it wasn't too long ago that we had some controversy, I believe, at Whole Foods over, you know, whether something was organic or whether it was actually cage free or, you know that they were actually selling things in the store that consumers realized were not being transparent about how, where the foods came from. So it's very, very important that consumers built this trust with the brands that they buy from.
Phil:You know, you're bringing up something that I meant to bring up on the previous story about eggs, but I got an email this morning from someone who is taking issue with Kroger. What they're doing is they're saying, you know, Kroger has not met its promise to go all cage free by 20, I guess it was 2022 or 2023. And they're really taking issue with it. And, and, you know, contemplating having a lawsuit, Hey, you know, something, Kroger and every other retailer should be offering all kinds of eggs, whether it be free range, whether it's cage free, whether it's conventional eggs. And the reason for that, especially as these prices are going through the roof, is let's, let's not forget that cage-free is nonsense. Cage-free just means having about a square foot of space that a chicken can turn a he can turn around in. It doesn't mean that they're happy-go-lucky chickens. So I think, you know, what, what we really need is clarity, as you point out, whether it's on organics or cage-free or anything. And in the bullseye, we're gonna talk a lot about that. There's a new report from the Food Standards Agency that comes out of England about why we might wanna keep away from that cake at office parties. What's up with that? I like cake
Sally:I do too. I love cake. It's the only reason I go to weddings. But yeah, there are two different sides to this story and two different opinions here from food experts and doctors One side is that bringing cake in, bringing sweets in for special occasions now isn't so special anymore that they're just, they're happening all the time. I guess if you have a big office and you have birthdays being celebrated all the time, or anniversaries or special occasions, then that cake is constantly coming in. And the theory is that it's much like smoking at the office, that you are actually, doing something that is not supportive for your environment. Now, on the other side, there are other experts that feel that we need to rely on our power of choice, and that, you know, if someone wants to bring cake into the office, then you have free will to choose to abstain from that dessert.
Phil:But here's the issue, and I've been in this circumstance, you know, recently where somebody brings in cake and you don't want it for whatever reason. And the look on their face, you know, almost makes you want to cry and just eat the cake just so that they don't feel bad. So we've got that whole guilt feeling going on too. And you know how, I guess the question is, how do you properly communicate when somebody brings in a cake or an ice cream cake for an office event that just says,"Hey, I'm on a diet, I just don't want it. I just don't want the calories," whatever. And I think that's probably the biggest problem and the biggest situation that we've got in dealing with this. We know that if people don't normally eat cake and somebody has cake or cookies in the office, people will nibble on'em. We saw, you know, at Google and a lot of these other tech companies that were giving out free food that you'd have people eating just because it was there versus that they were actually hungry or needed the nourishment, and in many cases they actually gained weight. So we have to be smart about this as well. And it's really about that communication. Talking about communication. Let's talk about veganism, you know, it's Veganuary meaning go vegan for January. We're seeing that around the world. It started in London a number of years ago. It's just gained more traction as we go. But some of the latest reports that are taking place say that, you know, it's really hard to be a vegan. Less than 3% of Americans are vegan by the strict definition of vegan. Why is it so hard to be a vegan and and you were a vegan for a number of years?
Sally:Yes. I was on a vegan diet for three years, living in Los Angeles at the time, which was a much easier place to be a vegan than where I am now in Tennessee. But the challenges that arise in, in being vegan, you know, number one, you completely overhaul your diet. And so you are restricting yourself from things that you are used to, foods that you love and then you're looking for replacements for those. And oftentimes those foods, those vegan foods that are in our supermarket or in restaurants, they are more expensive. So it can be quite expensive to follow a very strict vegan diet. And then there's also just your environment, you know, where you are in the country, who you are around, you know, what sort of circumstances you're in that can make it difficult for you to follow a vegan diet.
Phil:And also, let's not forget that there's a lot of animal products that go into a lot of other foods. Yes. That normally we might not think about. So for example, I have a very vivid memory of, this goes back probably 40 plus years, more than 40 years, probably close to 45 years that my dad was selling cheese to the then wholesaler before it became a retailer Erewhon which was more the natural foods industry. And what they wanted is they wanted cheese that, you know, did not have animal rennet. Now, in order to have to create cheese, you need what's called a starter and bacteria. And that usually came from, you know, animal intestines. And my father was, you know, searching high and low, and finally he came up with an artificial rennet that could produce cheese, that would meet Erewhon specs. So it's not as easy as people think. But, you know, I think what vegan does, and a lot of these other programs do, is they try to give us a balance, that you can still eat meat, you can still eat poultry, but just eat more vegetables and smaller portions of that meat. And you're probably, unless it's for ethical concerns, that you're not gonna want to eat meat, you're probably gonna win as it relates to your diet and being able to, to do it.
Sally:Yes. I think that's spot on, Phil. And the point of this campaign, isn't necessarily to encourage commitment to a vegan diet year round for everyone. It isn't for everyone, but if a lot of us started eating less meat, then we could quite possibly be a healthier population, and we would also serve our environment.
Phil:And also there's some brands that are capitalizing on this. Obviously, caulipower, Do, and Future Farm is doing it. But also what I love is Future Farm, who, and they're located in the UK, have really jumped on this. And what they've done is they've really capitalized for vegan area on the Royal Brothers Feud, and they're putting up billboards. They've put up billboards, one that you, you know, what you found, that poked fun at the Royal Family Food, not only helping people to pay attention to the brand, but also gives Future Farm the opportunity to show off its brand personality, having nothing to do with veganism. But just making fun of the two brother's feud and using that as a way to get their brand out there. I think it's sort of like a cheap shot to be honest with you. But, hey, you know, the brothers are playing it out in the public forum, so, you know, good for Future Farm. Talking about stopping eating meat for January. Also, people are looking at Dry January as a way to stop drinking. We've talked about that before, but a new report has just come out saying that health experts say that those who are trying to curb their drinking or stay sober for Dry January may find it helpful to hold an alcohol-free mimosa or faux mai tai when they socialize. However, if you've got severe alcohol use disorder, which I didn't even know was a thing, defined by the National Institutes of Health, it might not help because what it's doing when you have one of these faux cocktails, it's just reinforcing the whole cocktail thing versus, you know, getting you to stop. And if we look at the stats after Veganuary, after Dry January, sorry, people go back to drinking.
Sally:Yes. We haven't seen a huge impact on people quitting drinking. And, you know, for the Mocktail trend is great for those who do not have a negative relationship with alcohol that is bad for them. It's also great for Gen Z, this generation that's growing up that really isn't into drinking as much, but they like to go out and socialize. So mocktails can be fun. But we do have 6% of adults in the US according to the National Institute on Alcohol Abuse and Alcoholism, 6% have an alcohol use disorder. And during the pandemic we saw alcohol related deaths go higher than they ever have been before. So, it is a different situation for those who are dealing with that. And you know, the other thing, Phil, is when we think about these mocktails as well is, if you are going with the mocktail and you're going with the mocktail because you think,"oh, I don't want as much sugar, the alcohol's giving me too much sugar", you might be getting more sugar in that mocktail because some of them without the alcohol, they're using other ingredients to make it taste good and tomake it exciting that are just adding a lot more sugar to it.
Phil:Absolutely. So, you know it comes back to something that we've talked about for years. It's all about balance. That's all. It's balance and reading labels. Thanks Sally. Appreciate your insights as always. On today’s Bullseye– the tipping point on food nutrient profiling came on January 14th when Joe Rogan decided to post on Instagram his thoughts on what we should eat and how the latest work from the Tuft’s University Food Compass was in his words"complete, undeniable, indefensible bullshit." He added,"But yet this government funded recommendation chart is here to let you know they suck at giving food advice too." I’m not the first one to ask Rogan to keep his nose and mouth out of things he is neither knowledgeable about or qualified to talk and post about. Headlines make all the difference in our world today– and when Good Ranchers posted an article“New Government Funded Food Pyramid Says Lucky Charms are Healthier Than Steak”– the internet lit up. Let’s get some facts out there: first there is no‘new’ food pyramid, second no one, especially Tufts, is promoting Lucky Charms as part of a healthy diet and most important– Good Ranchers is a company that sells meat, poultry and seafood products online. This is a cheap shot and one that I am sure is designed to increase their sales built on the idea that consumers are just plain stupid. The chart that Rogan and Good Ranchers are promoting was designed by Tufts to actually demonstrate how the current systems that are used to rank the healthfulness of foods is in disrepair. Tufts is challenging the methodology behind their and others nutrient profiling systems– which is a good thing and, in my view, long overdue. Tufts issued a study-"Limitations of the Food Compass Nutrient Profiling System." Tufts’ Food Compass evaluates foods across 9 domains which then assigns a score of the food between 1 and 100– 100 being the most healthful. According to their algorithim and 9 domains the chart DID show a more healthful rating for the cereal than it did for ground beef, no question. But it was developed to make the point that we need a better nutrient profiling system. Watermelon and Kale, according to the rankings came out as the perfect foods. Both are healthy no question– but the perfect nutrients? Far from it. What we as an industry need to do is to be smarter, develop a better system and communicate it to consumers in a much clearer way. We have a real problem– according to the latest NIH data, 30.7% of adults are overweight and 42.4% are obese. What we need is honest clear communication that frankly can’t be hijacked by people who want to make headlines. The nutrition scientists who put the chart together(using Food Compass' data) contended the following in their paper:"While a conceptually impressive effort, we propose that the chosen algorithm is not well justified and produces results that fail to discriminate for common shortfall nutrients, exaggerate the risks associated with animal-source foods, and underestimate the risks associated with ultra-processed foods. We caution against the use of Food Compass in its current form to inform consumer choices, policies, programs, industry reformulations, and investment decisions." I am not here to argue whether the Food Compass NPS is good or bad– what I am here to state is that ALL of the current nutrient profiling is based on a serious flaw. That all foods are the same. The average supermarket has over 50,000 products, or at least it did prior to the pandemic, and using one NPS to rate the 50+ different categories of foods available is simply wrong. What Tufts and all the other NPS systems must do is develop nutritional criteria based on each category. Clearly breakfast cereal and meats need to be evaluated on different criteria– as do sodas and juices, canned vs. fresh soups or vegetables, breads vs. toaster pastries and so on. Until someone steps up and develops nutrient profiles by categories and stop using a catch-all profile– because its easier– we will continue to mislead and misinform our shoppers; and do nothing to help them choose better foods. The Lempert Report is all about inspiring ideas, making our industry think and challenging each other. Let’s think about“being the shopper” and how we can bring our supermarkets and restaurants closer to meet their needs. I hope you’ll come back to join us on next week’s installment of The Lempert report LIVE when we focus on the biggest and best insights– and the things that really matter. Be sure to visit SupermarketGuru.com for the latest marketing analysis, issues and trends and don’t forget to join us back here next Monday at 2:30pm Eastern for more.