The Lempert Report LIVE

From YouTube Star Controversies to Gut Health Breakthroughs and #FoodNotPhones Launches

August 08, 2023 Phil Lempert Episode 89
The Lempert Report LIVE
From YouTube Star Controversies to Gut Health Breakthroughs and #FoodNotPhones Launches
Show Notes Transcript Chapter Markers

Get ready for a lively discussion as we unravel the latest news from the food industry, starting with a shocking update on YouTube star Mr Beast's lawsuit against his food delivery partner, Virtual Dining Concepts. It's an intriguing look at the challenges celebrities face in the food sector. Also, Nestle's cutting-edge strides in gut health research, and how this could revolutionize our understanding of body mass index in toddlers and even the functioning of the immune system. We've also got the results from our fascinating grocery leadership survey with Stratovation, providing crucial insights into the potential impact of generative AI on the food value chain.

Prepare your taste buds as we journey into the world of alternative protein products and the humble, yet mighty, mushroom. We discuss their nutritional value, the mushroom mania sweeping the nation, and even their escalating prices. But that's not all! We advocate for quality family meal times with our National Food Not Phones Day, along with our partners, the FMI Foundation’s Family Meals Movement, Acosta Group, Hy-Vee and The Association of Retail & Consumer Professionals.  #FoodNotPhones is designed to encourage meaningful connections over meals, minus the phone distractions. This episode is a veritable smorgasbord of food insights, news, and trends that you won't want to miss!

Phil:

Welcome to the Lempert Report LIVE. On today's broadcast we've got an update on Mr Beast. Hate to say it, but we told you so. Nestle wants to fix our gut health. The changes in WIC are making a big difference. It's more mushroom mania, and that's a good thing, and Starbucks hits a new record. Now the results of our grocery leadership survey, in partnership with Stratovation. We asked grocery executives to rate on a scale of 1 to 10 how impactful they felt that generative AI like chat GPT will be to the food value chain, and the average score was 5.75, so just a little above the middle, but nowhere near all the hype that we're reading about. Let's get started. So about 10 months ago, or exactly 10 months ago, we did a report on Mr Beast and basically we talked about him opening up a fast food restaurant in New Jersey. We had a whole bunch of comments, but I just want to read you two of the comments. Number one "Jimmy is anything but greedy. Almost all the money he makes is reinvested into the content he produces. He's no dummy either. He's well on the way to helping revolutionize the fast food industry. He will no doubt combingle his brick and mortar with his vast online presence. Don't underestimate Mr Beast. He's a beast. "That one came from GWG 214. And then from Fluppytv. I just want to tell you that somebody who's a professional on that field manages that restaurant, not Jimmy. You will get a lot of dislikes for this video. Well, we didn't get a lot of dislikes, but here's the update. Mr Beast has sued his food delivery partner over low quality food. As you know, mr Beast's real name is Jimmy Donaldson. He has 172 million subscribers on YouTube and he filed the lawsuit last week against his food delivery service partner, virtual dining concepts, claiming the company damages reputation by serving customers low quality and, at times, inedible food. Now, sally, you've ordered Mr Beast. What was your experience?

Sally:

Well, unfortunately, Phil, my experience with Mr Beast was not great, and I preface that by saying that we are big fans of Mr Beast here in our household. He is very loved by his followers, he donates to a lot to charities and I can see why he is being very protective right now in this lawsuit of his brand, who he is and what he puts out there. But we did not have a great experience. We ordered a couple of times and our order was canceled an hour into when we had ordered it, and the problem was that we had a really hard time communicating with anyone. They've been operating out of ghost kitchens, so basically an already existing restaurant sets up shop to make Mr Beast burgers and to get those orders out. So it was really difficult to talk to somebody. And when I finally did get somebody on the phone, the answer was that the refund would come in six days, five or six days, and there wasn't really a reason why. We didn't really know why our order got canceled.

Phil:

Yeah, well, in the lawsuit, what Jimmy claims is the customers received orders that were delivered late, in unbranded packaging, it failed to include the ordered items and in some instances, were inedible. And the reason that he's pulling out of this business is that he can't guarantee the quality of the order and I give him a lot of credit for that. But, as we said at the time, I mean being in the restaurant business is difficult, and especially in the fast food restaurant business. And while on paper it might look great that you could have this, you know instant nationwide network of ghost kitchens and restaurants that make all this stuff, you need much more of an infrastructure. You know, I mean, the reason that McDonald's has done so well. I mean McDonald's has really strict control over their franchisees. They have people that are out there, you know, checking on the burgers, on the milkshakes, on the soda, everything that they do all the time. And you know it's fine to say I've got this great brand, you know I'm gonna make a Mr Beast burger, but I think what we're gonna see is we're gonna see a fallout also from a lot of these celebrities, as we've talked about before, who are rushing to get, whether it's in the alcohol business, the beer business, the food business. It's just not that easy.

Sally:

Yes, and Virtual Dining Concepts is a company that is really going after those celebrity brands that you know are being prepared and delivered out of these ghost kitchens.

Phil:

Yeah, I think you know we'll keep on this story, but I think we're gonna see more failures than we're gonna see successes. Nestle has decided that they wanna learn more about our microbiome and the reason for that is gut health Certainly over the past few years when we've talked a lot about gut health is so important for human health. It protects us from pathogens, contributes to our immune system development, helps food digestion and I give Nestle a lot of credit. Nestle is the world's largest food company and I've been to their research facility and they've got a lot of really smart people there and the fact that now what they found, it was actually not Nestle's research but it was research presented at the European Congress on obesity in June that the composition volume of gut bacteria in toddlers at three and a half years old can predict their body mass index at age five, and it uncovers individuals who are prone to adult obesity in early childhood. So I give so much credit for Nestle getting into this.

Sally:

Absolutely. This is a wonderful area of research, especially for the biggest food company in the world to tackle, and you know, I would love to see more consumers being educated on this idea of our gut health and what that can do for us. What you referenced here about how it can be a predictor of you know whether or not you are predisposed to obesity at a young age, that is wonderful research. A lso we know that when we have healthy gut bacteria, that we strengthen our immune system or we can strengthen our immune system. Another study found out that when people ate five plant-based meals per week instead of just a meat-centric dish, every time that they had better digestive health and less inflammation, which is going to protect us from diseases, and so this is wonderful research that they're getting into. Nestle is also getting more into the plant-based product arena and creating more vegetarian and vegan items for people, so I love seeing this happen with them.

Phil:

Yeah, and Nestle was not one of the first companies to jump into plant-based, but they're doing it right. They're doing it based on research and also, knowing the folks at Nestle, I'm sure that the foods are going to taste good as well, because that's been one of the biggest problems that we've seen with plant-based, which is why we've seen this spurt of people buying plant-based and then it falls because the products just don't live up to what they say it does. Back in 2009, the USDA made changes to the WIC food program. The changes, which included more whole fruits and vegetables, whole grains and lower fat milk, were the first comprehensive revisions to WIC since the nutrition program began in the 1970s. I want to just remind people that Michelle Obama was very involved with that when she was first lady, and the great news is that you know what we now have is we have more kids eating more fruits and vegetables and whole grains than ever before.

Sally:

Yes, this is wonderful news. The WIC program, which is part of SNAP, is for women, infants and children and this is wonderful news that they are seeing because of their efforts of their program. They are seeing more children eating fruits and vegetables, more children consuming low fat milk and they are also seeing a higher intake of whole grains. This is wonderful news.

Phil:

Yeah, and something that people may not realize or forget about, part of having WIC benefits is you have to actually go to some classes where they teach you about health and nutrition. The moms, not the kids, where they teach you about health and nutrition, and so on. So you know we need more programs like that than ever before. Mushrooms have been very hot in probably the past two or three years. A lot of that has to do with the work of the Mushroom Council, and now we're seeing what's being called, at least by some publications, mushroom mania, because the problem with mushrooms is that the industry hasn't been able to keep up with the production, and if you go into a mushroom farm, which is an indoor building, which is probably has racks of mushrooms that are probably about 20, 25 foot high, it is really old school. And now what we're starting to see is new people getting involved, more startups with indoor mega forms, and frankly, I think that this is going to make mushrooms grow even more. Mushrooms are a complete protein. They have vitamin D when they're hit with a UV light, and it's really a terrific food that we have, and the problem has been we've had to import it either from Canada or from China or parts of Europe, but now it looks like people are actually investing here in the US in these indoor farms.

Sally:

Yes, we are seeing production grow in the United States and hearing that there are at least 42 companies in the country now that are developing alternative protein products. Everyone's getting in on it, Phil. Five-star chefs are creating dishes with mushrooms, and then there are a lot of companies that are getting involved in creating products for our supermarket and I think this is going to be great for consumers if they find these products that they really like the taste of it, because they're also better for our budgets. A company called Meati is putting out these two-package cutlets of big portobello mushrooms at Whole Foods for $8 for a two-pack. Now you think if you bought a two-pack of steaks, how you would compare that cost? So it's great news. Also just wanted to add that mushrooms are very high in fiber, and we recently talked about a study that found out that we as Americans are very much lacking in fiber in our diets, so this is another way for Americans to get that fiber.

Phil:

And the other shout-out to all the mushroom producers is put the nutritional information on the package. But, to be honest with you, what I really don't understand is most mushroom producers don't put nutritional information on their package. As a result, the average consumer likes mushrooms, they know how to cook them, they know how to use them, but they don't know how rich in nutrients they really are. So hey, you mushroom producers out there, start putting nutritional labels on your product. Also, a report just came out from Starbucks that found that two in every five customers added food to their orders in the latest quarter. That's up over 25% over five years ago, and they've now brought the average check to an all-time high in the quarter. It's up about 6%. So Starbucks is a lot more than just coffee and bottled water these days.

Sally:

Absolutely. And personally, I was not surprised to see this, Phil, because my children absolutely love breakfast from Starbucks. My son always wants to order the bacon, gouda egg sandwich and my daughter, who's a vegetarian, gets the tomato mozzarella panini sandwich, which is not necessarily a breakfast item, but she likes to eat it for breakfast. So I'm really not surprised. Those foods are right there in the case in front of you when you're ordering and it seems like it's not a lot of work for the people that work there to prepare them. They just pop them in the oven that they have right there and they're ready to go.

Phil:

Yeah. The only thing that I think that Starbucks should do differently is it's not very appetizing looking. In their case, everything is wrapped in cellophane and then, yes, if you order it, they'll put it in the oven, then they give it to you, and so on. But get rid of the plastic. Just let us look at real food and I think their sales would go up even more. Today we have a brand new announcement and a brand new initiative, along with our partners, the FMI Foundation's Family Meals Movement, Acosta Group, Hy-Vee and the Association of Retail and Consumer Professionals, and more to come. It's called National Food Not Phones Day. You can check it out at FoodNotPhones. com and join us. Here's a preview of what it's all about. Hi, I'm Phil Lempert and I invite you to join us in brand new initiative #food not phones. Take the pledge to join us for one day of enjoying meal times without your cell phones. Now, don't panic. We aren't asking you to put that phone away for an entire day. Just set it aside while eating with friends and family and let's see what happens. Our pause from screens will inspire joy and community and remind us all of the power of human connection and what that has to offer. I've always treasured the time-honored practice of sharing a meal with family, friends and colleagues, as I'm sure you have as well. Across all cultures, sharing food has always been part of a human connection, something that we need now more than ever before. I was dismayed to read the US Surgeon General, Dr Vivek Murthy's letter regarding our Epidemic of Loneliness and Isolation 2023, where he made a public statement on the health implications of social isolation. Poor or insufficient social connection is associated with increased risk of disease, including a 29% increased risk of heart disease and a 32% risk of stroke. It is also associated with increased risk for anxiety, depression and dementia, and may increase the susceptibility to virus and respiratory illness. Frequent phone use during face-to-face interactions between parents and children, between family and friends, increased distraction. It reduced conversation quality and at lowered self-reported enjoyment of time spent together in person. Come be a part of the solution to the loneliness epidemic. Sign up today and join us. Together, with small steps, we can make a powerful change. Use the #FoodNotPhones on social media and help us spread the word. As soon as we get done, go to FoodNotPhones. com and I hope you'll join us in this very important initiative. Now, on today's Bullseye, sally and I are going to focus on the reason that we created Foodnot Phones. It all started when we read the Surgeon General's report on loneliness. More on that in a minute. Research has revealed that the more often that people eat with others, the more likely they are to feel happy and satisfied with their lives. That's why the FMI Foundation created Family Meals. Researchers found that people who eat socially are more likely to feel better about themselves and they have a wider social network that's capable of providing social and emotional support. Despite the clear correlation between social eating and social bonding, with 76% of those questions saying that they thought that sharing a meal was a good way to bring people closer together, it's a no-brainer, sally. What's the Surgeon General's concern?

Sally:

Phil, the Surgeon General released his letter regarding our epidemic of loneliness and isolation in 2023 this year and you know it's really important for us all to pay attention to this, because what the science is now telling us is that lacking social connection can increase the risk for premature death as much as smoking up to 15 cigarettes a day. The science is also telling us insufficient social connection is associated with increased risk of disease, including a 29% increased risk of heart disease and a 32% risk of stroke. Now, we love our phones as Americans and you know they serve a lot of purposes for us. If it's work, if it's social connection. You know through our social media apps or you know, mapping, when we we need to go somewhere or shopping online. We use them for so many things and science is telling us that the average American spent six hours a day on their phone. So this initiative that we are talking about here #FoodN ot Phones is an effort to encourage people to put them down when we're having meals together and take that pause from your phone so that we can actively engage with each other and let's see what happens.

Phil:

Absolutely, and it's so critical, especially now more than ever before, that people connect with each other, they talk to each other and again, you know what we're not saying is never use your phone. We're just saying, during mealtime, you use the #FoodN otP hones so that people know that, hey, you're not going to answer them until after your meal. Now, the first Food Not Phones day is September 19, 2023. That's going to be the official National Food Not Phones day every year. But we don't stop there. What we're going to be doing is we're going to be posting on the website other Food Not Phones days. So, for example, Thanksgiving, we're going to do Christmas, we're going to do Hanukkah, we're going to do Kwanzaa, we're going to do Easter, we're going to do other holidays that it's important to have family time together. So I hope you'll join us. Foodnotphones. com. Check it out. A lot more information on the website went live on Friday. We already have over 15,000 people who have joined us, so I hope that we can ask you to join us as well. So, Sally, any comments today?

Sally:

Yes, Phil. We have a couple of comments from John Pandol that I wanted to talk about. The first one is "hey, influencers and celebrities. Brand extension is one of the hardest marketing tricks to pull off, and delivering a good product or service or burger consistently on scale is even harder. Who told you

Phil:

And John, we're with you a thousand percent. Absolutely, and that's what we said 10 months ago as well. So thank you for adding your voice. A nything else?

Sally:

Yeah. So John also says "Phil, have you seen some of the high end mushrooms grown in store? 20 to $40 a pound stuff fresh out of an aquarium terrarium, sorry type fixture.

Phil:

Yeah, I haven't seen it in store, John. We have a Farmer's Market every Sunday right around the corner from where we live here in Santa Monica, and there's a mushroom stand that does enormously well and there are varieties of mushrooms that I had never seen. I keep on buying different mushrooms. I happen to love mushrooms. To be honest with you, I don't like the ones that are really stringy and high in fiber. I know that's good for me, but you know I like to saute them and put them in other foods. But I haven't seen the price at 20 or $25 a pound yet, but I'm sure that here in Santa Monica it's going to reach that. So, John, as always, thanks so much for your comments, and if anybody else has any comments, please go to the website, post them there. We will answer you, we promise, and with that, thanks for joining us.

Sally:

Be sure to visit SupermarketG uru. com for the latest marketing analysis, issues and trends, and don't forget to join us back here next Monday at 2.30 pm Eastern for more.

Mr Beast Sues Food Delivery Partner
Mushroom Mania and National Food Day
Mushroom Preferences and Price Predictions