The Lempert Report LIVE

Exploring Retail Strategies, Food Trends, and Grocery Industry Controversies

September 05, 2023 Phil Lempert Episode 93
The Lempert Report LIVE
Exploring Retail Strategies, Food Trends, and Grocery Industry Controversies
Show Notes Transcript Chapter Markers

Are you ready to unravel the intriguing strategies of retail giants, or venture into the world of celebrity-chef-crafted frozen foods? This episode promises to open your eyes to the complexities and controversies of the food and grocery industry. We'll journey into the heart of Walmart's most recent initiative to cut prices for their Plus service for families on government aid - a bold move following Amazon Prime's legacy. We also turn the spotlight on Gordon Ramsay's unexpected pivot to frozen food, a venture that has stirred up quite a buzz. We'll also dig into the Grocer Leadership Survey and its revealing insights on self-checkouts and shrink in the industry. And let's not forget the deep dive into the bewilderingly long ingredient list of some chicken pot pies!

From there, we pivot to the burgeoning food trend embracing the perfect symphony of sweet and spicy flavors, with hot honey and fiery pizzas stealing the show. We'll discuss intriguing data pointing towards a cross-generational craving for this taste blend and how hot honey is anticipated to top the flavor charts by 2027. Supermarket self-checkouts and their psychological impact on customers, particularly the older generation, is another fascinating subject we'll delve into. We'll also share a heartwarming initiative by a Dutch supermarket chain to combat loneliness. Finally, we shine a light on the importance of staying present at mealtimes, with a special nod to the #FoodNotPhones initiative launching on September 19th.

Phil:

Welcome to the Lempert Report LIVE. On today's broadcast, what Walmart is doing to help those in need. Has Gordon Ramsay made a really big mistake? Samsung's new recipe service. Something to think about the next time you're at a ballpark. The latest food trend isn't so new afterall. On Food Not Phones, how your supermarket's checkout can be a powerful cure. And on the Bullseye, it's all about the New York Bodega. We also hear from our Grocer Leadership Survey and have the results. The question from last week was: Do you feel self-checkout is having an effect on the increase in shrink seen in the industry? 80% believe that self-checkout is having an effect on shrink. 55% of those people said yes a very large effect. 25% said yes, a small effect, and 15% said no effect whatsoever. So that's it. Make sure you take our poll on the Grocer Leadership Survey that'll be in our newsletters, and also please check out Food Not Phones and join us for National Food Not Phones Day on September 19th. Let's get started. So, Sally, Walmart has announced that it's cutting the price of Walmart+ for households that receive food stamps or other government aid. This actually follows suit with what Amazon Prime did a couple of years ago and the Walmart cut is significant. It's half. Now you pay $49 a year instead of $98 a year, and it comes at a time where this is really important. 41 million people in the US are on some kind of food stamp program through SNAP, and the Walmart+ program is very beneficial because you get free shipping, fuel discounts, access to Paramount Plus streaming service, unlimited deliveries of online order $35 or more. Morgan Stanley says the Walmart Plus has 21.5 million members, although Walmart has not released that number. So what do you think? Is this going to really help Walmart Plus? They have 21 million. If you look at Amazon Prime, they've got 117 million people on that program, so is this a plus for Walmart?

Sally:

Well, let's hope this is a plus for Walmart's customers, particularly the ones that are struggling with food insecurity and struggling with the cost of food right now, as we've seen so much inflation. What I would like to know, Phil, I'm wondering, is what about all of these people that were just taken off of the SNAP program because our pandemic era funding has ended. So a lot of people lost their benefits and I wonder for those people, is there a way to qualify for this discount with Walmart Plus? That would be a really wonderful thing to say.

Phil:

Yeah, you bring up a really good point because Walmart has not said that if you were on it and you lost that benefit, now you can be on ours. Great point. Walmart, I hope you're listening. Gordon Ramsay, on his programs, has always knocked frozen foods in my opinion, not very fairly as well. So he announced guess what? He has a line of frozen foods. It's called by Chef Ramsay Collection. It's only sold at Walmart. There's eight different products Bolognese filled lasagna with four cheese, four cheese macaroni, baked mushroom risotto, chicken pot pie, fish and chips, lemon caper chicken, slow roasted beef and the British classic shepherd's pie. What do you think? I mean he's coming under a lot of criticism on social media for doing this.

Sally:

Yes, he is coming under criticism and I guess that has a lot to do with his controversial personality and how outspoken he can be expressing his opinion. So I guess if you're one of those personalities, if you can dish it out, you can probably take it as well. But some people are also celebrating the fact that he's created this frozen foods line, and it is a natural progression for someone of his status in the world of being a chef and being a TV personality for food. It is not surprising that he would come out with a frozen food line and that it is available in Walmart. It is under $6 for each one of these and it is something that a lot of people depend on frozen foods and I like what you said, Phil, about that. Frozen foods get more of a bad wrap than they actually should and there are actually some really good products in our frozen food aisles that particularly people that are single elderly living alone. They want those products because they don't want to cook for one person.

Phil:

Exactly Just one of his Twitter followers. I have to read this. I love it. "I just tried the mac and cheese. It may have been the worst frozen mac and cheese I've had in a long time Rubbery noodles, soggy cornbread crumbs with a weird cheese sauce. I expected better from him considering his stance on frozen food. So I think you're right that there's a lot of really great frozen foods in that frozen food department. But you got to read the labels. So there's a study that came out that linked ultra-processed foods to higher depression. We're going to talk about that in a second. But when I looked at his ingredients and his nutritional information, he's definitely ultra-processed food. I just looked at chicken pot pie. It has 56 ingredients in it, 56 in one chicken pot pie. On walmart. com, it actually sells for $6.24, even though their press release said $6. It's 460 calories, 20 grams of fat, 1470 milligrams of sodium, 19 grams of protein. And then I looked at Marie Callender's chicken pot pie, which is one of their best-selling ones and that one sells just for $2.98 on walmart. It has 40 ingredients, 36 grams of fat, a lot more fat, 610 calories, 960 milligrams of sodium and 17 grams of protein. So I think that will be enough that in Ramsay's case, you know he's made a name for himself as a chef, has very successful shows, but somebody needs to look at these ingredients and this nutritional information, because when you go up and down the aisles of the supermarket, there's a lot of terrific, to your point, frozen foods now that don't have 56 ingredients in them. There are some that just have, you know, four or five, especially when you look at something like a chicken pot pie. I think it's a little absurd. So the study that linked depression to ultra-processed foods and maybe if Gordon Ramsay is going to eat his own foods, he's going to get depressed was a study in Melbourne, Australia. They reviewed 23,299 individuals between 27 and 76 years old that were part of this study, and what they found is that the more the person's daily calories come from ultra-processed foods, the more likely they are to experience depression long-term, and the association between these foods and depression persisted regardless of sex, body mass index, age, marital status, social living situation or a level of physical activities. And they measured it over a number of years and they found that, you know, you could be as depressed from eating these foods as much as a decade later, 10 years later. So what are we thinking, you know? Do we really need all these ultra-processed foods if we have this kind of science, that's, you know, telling us from a health standpoint, they're not good for us. Now, from a mental standpoint, they're not good for us. A lot of the ingredients. When I looked in both Marie Callender's and Gordon Ramsay's chicken pot pies, they were not pronounceable. So what is going on here?

Sally:

It's a very confusing topic, I think, for a lot of people. This is a great study. I think this is an important study about the link between depression and ultra-processed foods, something that our society is suffering from a lot right now depression and anxiety. But what's interesting is that just a couple of months ago, Phil, you know that the USDA just announced research that showed that somebody could eat a well-balanced diet and get all the nutrients they need, with 91% of those calories coming from processed foods. So there's information coming out here that I think can be conflicting for shoppers. We need to know that if you're going to eat processed foods, that you know that it can't just be processed foods and to look for, like you're saying reading the ingredients, look at what those nutrients are, what nutrients does that product provide? But this definitely needs to be cleared up for a lot of consumers. Or, you know, we need to continue study what the effects of these ultra-processed foods are in those ingredients in them.

Phil:

Absolutely. Samsung has announced a new service, Samsung Food. It's a personalized, ai-powered food and recipe platform. Just last week, I was talking to Frank Yiannis, a friend, ex-deputy commissioner of FDA, and he has one of these Samsung refrigerators, these smart refrigerators, and he explained to me that there's a camera inside and that tells you what's inside your refrigerator and it could tell you when you need to order. He said it's not very accurate, so my hope is that this Samsung Food is going to be a lot more accurate. It's being released in eight languages in 104 countries around the world. Comprehensive food experiences through more than 160,000 recipes, and it helps people discover new dishes, create tailored meal plans, other ingredients and you can also control your cooking appliances from this app, with giving step-by-step guided cooking and allowing users to share their favorite recipes on social media. This is the internet of all things. This is what we've been talking about for decades having these smart appliances and so on, you ready to go out and get Samsung food in your kitchen?

Sally:

Well, it sounds really amazing and I think this is huge. This kind of technology, Phil, because they're talking about being able to not only operate your appliances and get recipes, but to get personalized recipes, to be told what's in your refrigerator that you need to use so we can cut down on waste, and to suggest recipes for that. We're talking about. They're looking at for the future, for 2024, releasing components of this that help with our health management that suggests foods. The only thing I see that makes me stand back a little bit, Phil, is this another opportunity for me to be manipulated by an algorithm? Are those recipes and those suggestions and those foods coming up? Is it going to be part of marketing to me more and more? And as a human being and I think we all think this way I don't want to always be manipulated by the internet everywhere I am in my house.

Phil:

Right, I agree. And yes, what they're saying is they're going to collect that user data and that's going to be hitting you back with your dietary preferences, different favorite cuisine types. So, yes, I definitely think that Samsung Food is going to know more about your cooking habits than your family does. And again, as we cross this threshold into the whole BMI body composition, calorie consumption my question is just like yours is that refrigerator door going to say, "hey, phil, too much sodium this week, don't consume anything else with sodium? You raise a really good point. Let's talk a little bit about food waste. That's what you talked about, that the Samsung food could help with Last mile food rescue. Is this company that's really cool? Tell us about it.

Sally:

Yes, this Last Mile Food Rescue was formed to find ways to bring food to people in need that was left over from businesses, and where the ball got rolling - no pun intended - is at the Great American Ball Park, which is where the Cincinnati Reds play. I don't know if you follow baseball, Phil, but that's where the Reds play, and what they do is they have these volunteers that they call "heroes that basically bring a truck up to the stadium after the game and whatever wasn't sold during those concessions for example, based on their averages, 730 pounds of perishable food can be left behind so they're loading up that food. It's not hot dogs and beer, it's produce, fresh produce, it's frozen burgers. It's really good quality food that they're taking out to the community and bring to people in need. And what they're trying to do is they're trying to encourage all of the stadiums, particularly in Ohio. Right now, the Cincinnati Bengals Stadium has joined the University of Cincinnati, which is where I went to school. They are also their stadium has become a part of the program, and I think if we can get all of our sports teams and our big arenas and stadiums around the country to participate in a program like that, we could really be helping out a lot of people and feeding a lot of people.

Phil:

Absolutely, and not having food just being wasted. So, yeah, I agree, I love this program, we applaud it and we hope that it spreads. They hope that it spreads throughout the nation as well, after Ohio. But programs like this, where people work together, where they have a lot of volunteers, it really reinforces the community as well as helping people have good, nourishing food. So good for you, kudos. So there's a new trend. I think it's a trend. I don't think it's new from what I've read. Tell us about that.

Sally:

Yes, we are seeing everything sweet and spicy now, Phil, and it reminds me of when, a decade ago, we saw everything sort of salty and sweet mixed together. We had bacon cupcakes showing up in pastry shops and bacon and everything mixed with sweet, and so it's very interesting to see now that that has turned into a sweet and spicy trend. Hot honey is one of the items that has to really really come forward in this trend. Pizza Hut put this hot honey on one of their products, which I think brought a lot of attention to it. But that seems to be what's going on and I'm not surprised. My 10 year old daughter wants to eat the sweet and spicy Takis, all of the products like that.

Phil:

Yeah, and it's not only millennials and Generation Z, but this is across all generations. According to datassentia l, sweet and spicy pairings on restaurant menus are up 38% in the last year. Hot honey is projected to outpace nearly all other culinary and beverage flavors by 2027. And Mintel, another research group, found that two thirds of Americans are interested in sweet and spicy sauces and 70% of consumers who like spicy food would like to try hot honey flavored foods and beverages. We're seeing a lot more creativity when it comes to beverages. We've talked about that before, but the reality is that these trends come and go and I'm not sure that this one the sweet and spicy is gonna have long legs. Keep in mind that what they're not talking about is ask people age, from about the age of 20 forward, what happens is you start losing your taste buds. So the question that I've got is whether or not people are adding sweet and spicy because they're losing taste buds and it needs flavor. You take a 15 year old and you take a 50 year old. You give them the exact same food and it's gonna taste different for them. So we'll have to watch this trend to see whether or not it's got legs to it. Today, on Food Not Phones, we've shared this fact before, Americans face an epidemic of loneliness. For some, supermarket self- checkouts are making it worse, according to Marissa Gerber's column, a great column in the Los Angeles Times. She writes the two thirds of Americans said technology has made it harder to meaningful, meaningfully connect and nearly 70% said it has led to a decrease in empathy. That according to a recent survey from PlayUSA, a website that covers online gambling. So, Sally, is this yet another thorn in the side for self checkouts?

Sally:

I believe so, Phil, and just to share a quick personal story about this just last week I was at Kroger and my next door neighbor was shopping. I ran into him there. He just lost his wife very suddenly this summer. He is a senior citizen, he was in the self-checkout and he was really struggling with trying to get his coupons to work. His wife, who he had been married to for 50 years, always did the shopping and knew how to handle the coupons in the self-checkout and he was really struggling. There was no one around to help him because they were busy with other people. And so I think this is really something we have to consider, particularly for our older generations. Is that cashier being in that line, interacting with a human being, having help, but that's really important to the shopping experience and also just being in the store and connecting with other people. And maybe the self-checkout isn't for everyone.

Phil:

Yeah, and you talked about having older people not really comfortable with the technology. There's a supermarket chain by the name of Jumbo it is actually in the Netherlands and they have a whole different approach to this. What they've done is they've created intentionally slow-moving lanes at several stores for older shoppers or anyone who wants more time to chat with cashiers. The goal, according to the company, was to help tackle what they saw as a growing problem of loneliness. So there are things that we can do, and we have to recognize that not everybody wants to get in the store as quickly as they can and get out as quickly as they can, but for a lot of senior citizens, the store does become part of their community, especially and this article points out some examples too especially as, with your neighbor, they've lost their mate. Now they've got to take on new things. The story that I love that this reporter did was talking about a cashier who noticed that this gentleman who went shopping every week had changed what he had in his shopping cart and he was now using more frozen foods. He was using more processed foods than he used to. So she asked him about it and it turned out that his wife had passed away. He was the cook in the family and bottom line is cooking for one. What you said before is difficult, which is why some of these frozen foods exist. And then a few weeks later she noticed that his cart was being filled up the way it used to be, with more fresh foods and so on, and the reason is he got a new girlfriend. So now he's cooking for that girlfriend as well. Great story in the LA Times, definitely worth a read for everybody in the supermarket business, every executive, to really understand what that shopping experience is supposed to be, and especially at this time where we don't have enough labor. Just putting in self-checkouts might not be for everybody and might not be for every store as well. So it's an important reminder to us all. And talking about reminders, I hope you'll join in on our newest initiative, Food Not Phones, where we all commit to putting down our phones during meal times. On September 19th, join us, along with industry leaders like the FMI Foundation's Family Meals Movement, the Acosta Group, Hy-vee, Fresh Direct, That's It, Shuttler ock and the Association of Retail and Consumer Professionals. You can check it out at FoodNotPhones. com. Thanks Sally. On today's Bullseye, Eater writes that a new that New York is in a golden age of Bodega food. Now, if you're not a New Yorker, you may not truly understand the importance of Bodegas. These are small food stores that are typically run by immigrants that are around just about every corner in Manhattan, according to the United Bodegas of America. Yes, such a group exists. An organization to help advise, assist and protect the interests of both small businesses and winemakers. They say that there's over 13,000 Bodegas in New York City alone. In other parts of the nation you might think of them as C-stores, but the major differences is that each New York Bodega has its own personality, usually centered around a well-stocked deli and prepared foods to go, and most are independently owned. Now the story in Eater explains how these Bodegas are igniting culinary innovation and have become, in fact, incubators for a lot of restaurateurs. Now I happened to catch last night on MSNBC John Leguizamo's new show Leguizamo Does America. It's a six-part series and it was episode one. It was in New York City. He happens to come from Queens and a lot of the story was about Bodegas and, in fact, one example that he showed was chopped cheese. Now, chopped cheese is a sandwich that contains ground beef with onions, melted cheese, lettuce, tomatoes, condiments, on a hero role. Some argue that it started in the Bronx, others say Harlem. Leguizamo said it was actually in Queens. But what is clear is that it's remained an enduring influence on New York food culture, as well as expanding nationwide. In Queens there's a group of restaurant owners who are tired of struggling during and after the pandemic, so they opened up a tied buffet in the back of the Lopez Marketplace. Bodega Sunny and Annie's is a 24-hour deli and, according to Eater, has been serving some of New York City's most creative sandwiches, combining ingredients like bulgogi, bacon and cantaloupe and creating dish names to riff on politics as well as other cultural events. It seems like the Bodega of yesteryear that just specialized in making sandwiches of turkey, salami, roast beef have evolved into gastronomic meccas. Well, you might blame it on the Food Network, the evolving palette of New Yorkers or the pandemic, but the reality is that many of these Bodegas are now owned by entrepreneurs who do a lot more than just wait for neighborhood customers to stop in for a quick sandwich that they can get off that slicing machine or the produce and groceries that line their shells. Rahim Mohamed runs what some might call New York City's most social media famous Bodega. This deli counter is his stage. The Yemeni American owner freestyles the menu. He decides sandwich combinations on a whim. The Ocky Way what he says. The Ocky way, which might include pancakes and hot sauce. The Ocky way is part of the trend of proprietors that are messing around with what Bodega food looks like, and they're on social media as well, telling the world online. Dattz Deli in Hollis, Queens, is one of the handful of spots that have been benefited financially from the social media boom, reportedly raking in $165,000 a month, according to CBS News, and bringing in new customers that are traveling to go there and wait hours online. As restaurants and delivery services increase their prices and have to cope with higher food costs, higher labor costs and a shortage of workers, this new Bodega might just be the solution. Supermarkets that are reimagining what their gross are on or food hall format should be should take a trip to New York City and go Bodega hopping. See you next week. 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.

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