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Notes & comment from the FMI Midwinter Executive Conference

SCOTTSDALE, Arizona – Sleep and food.

Are there more fundamental aspects to everyday life? (Okay, we can think of one or two.)

Yesterday’s sessions at the Food Marketing Institute (FMI) Midwinter Executive Conference here actually had the potential for life changing influence in these areas. However, to be fair, to achieve such changes in lifestyle would require significant changes in attitude…which is easier said than done.

Dr. James B. Maas, a professor at Cornell University, offered a fascinating and sometimes disquieting look at the sleep deprivation in America today, telling the audience that “most people are moderately to severely sleep deprived,” with 70 percent of Americans getting six hours or sleep or less a night during the work week. In fact, he said, the percentage of Americans who can get along on less than eight hours sleep – no matter what they say – is virtually zero percent. High school and college students, he said, need 9.5 hours of sleep but get, on average, 6.1 hours. “We have their bodies in the classroom at 7:30 in the morning, but their brains are back on the pillows,” he said.

According to Maas, sleepiness diminishes concentration at work, the amount of work accomplished and the quality of work performed – and, in the end, costs industry $100 million a year in mistakes, accidents and lost productivity. “Being sleep deprived makes you clumsy, stupid, unhealthy and it shortens your life,” he said, noting that one of the best indicators of the potential for long life is not diet or exercise, though those are important, but the quality of sleep. Scientific studies, he said, show definitively that a sleeping brain helps to replenish various bodily functions, and that lack of sleep doesn’t allow the body to do what it needs to do to survive.

Furthermore, Maas, it has been proven to be more dangerous to drive tired than to drive drunk.

“For peak performance,” Maas said, “we must invest one third of our life in sleeping.” And, he said, if we don’t get sufficient sleep, “we are operating our bodies beyond their design specifications.”

Maas’s presentation wasn’t just designed to get the audience to get enough sleep each night; in fact, it probably didn’t even get people to get more sleep last night, since there were dinners and parties until late in the evening and breakfast was scheduled to be served starting at 6:30 am. His broader point was that in a society driven by a 24/7 mentality, in which it is considered macho to go long periods without sleep, we are actually creating a society in which productivity is at risk – never a healthy trend in an industry where increased productivity is always a key to increased profitability.

Later in the day, there was a discussion of another subject with both social and business implications, one that has long been a favorite topic here on MNB - the need to bring the family together for more dinners.

Marialisa Calta, author of “Barbarians At The Plate: Taming & feeding The Modern American Family,” headlined the discussion by sharing anecdotes from her research for the book; she went shopping with parents, cooked with them in their homes and ate with their families, trying to get an intimate look at their kitchens and pantries.

She said that while people seem to be interested in the health and values of their children, and understand the importance of eating together as a family, that impulse often is undermined by the fact that they often “are afraid of food, are afraid that food is going to kill us. They have a fear of cooking food because they’re afraid that it isn’t going to be the same as it is on the Food Network.” This, she suggested, is the dichotomy that retailers need to address – creating an environment and an approach that dissipates the fear and encourages the family dinner.

It should be noted that before the FMI Midwinter Conference convened on Sunday, there was a joint meeting of FMI’s board of directors with that of the Grocery Manufacturers Association (GMA), at which Joseph A. Califano, Jr., the former Secretary of Health Education and welfare in the Carter Administration, and the current chairman of the National Center on Addiction and Substance Abuse (CASA) at Columbia University, addressed some of the same issues. The center has found through extensive research that kids who eat dinner with their families have lower incidence of smoking, drinking and drug abuse. Other studies find that family meal time can be a direct link to better performance in school, better manners and better eating habits.

After that session with Califano, several board members expressed interest in creating a consumer marketing program that will focus on encouraging the family dinner. FMI CEO Tim Hammonds told MNB that based on this response, FMI is actively exploring the feasibility of such an initiative, which would be a co-venture with CASA. (MNB has been lobbying for such an effort for years, and heartily applauds FMI for taking this important step.)

Of course, it isn’t just as simply as encouraging the family meal. There remain impediments, such as Calta’s suggestion that people are afraid of food. In a panel discussion led by FMI’s Michael Sansolo, there was further exploration of the culture of food that often is avoided by many supermarket chains, which see such concerns as foreign to their bottom line orientation.

Nancy Kruse, a restaurant industry analyst, noted that her segment of the food business has lately seemed to have the advantage in taking advantage of what she called a “culinary revolution.” More people than ever are going to culinary schools around the country, the Food Network seems to have made culinary culture more accessible, and even mid-range restaurants are trying to raise the level of their game.

Ironically, she said, when chefs identify the three major trends on the horizon, they point to 1) freshness, 2) flavor, and 3) health – all of which play to the strengths of the modern supermarket. (Kruse said that “flavor” tends to be a note that the restaurants play better than supermarkets, though it doesn’t have to be that way.) But to this point, she said, the supermarket industry has not taken advantage of its strengths.

And Doug Rauch, president of Trader Joe’s, said that his company has managed to succeed by focusing on the specific things that its customers seem to want: freshness, portion control, convenience, value they can count on, and what he called “speed scratch cooking that makes a single meal in 10 minutes in one pot.” And he agreed that customers can be primed to expect these offerings from a supermarket. “One of the reasons that people like to go out is that they like adventure,” Rauch said, suggesting that supermarkets can both nurture and serve this need.

Of course, this raises the real issue. Retailers have to want to do it. They have to believe in its potential for both differentiation and profit. And they have to be willing to commit to such an approach in the long term, not just for a short-term fix.

Tom Chappell, founder and CEO of Tom’s of Maine, asked the question that struck us as the most important of the day. Undertaking these kinds of initiatives, he said, makes “marketing and merchandising more complex, and yet retailers love the simplicity of category management.” Is it possible, he suggested, that by remaining committed to category management, retail chains actually haven’t caught up with a changing consumer?

“Ay, there’s the rub,” as Shakespeare wrote in “Hamlet.”

We spoke with Chappell later on in the day, and he told us that he didn’t mean to suggest that category management was obsolete – just that it isn’t always a complete solution. “Stores need to be involved in customer management as well as category management,” he said, agreeing that it is harder and more challenging, but ultimately more rewarding. And, he said, there are plenty of stores proving that it can be done, including Trader Joe’s, Wegmans, and Whole Foods.

Sleep and food. Two critical parts of everyday life, and two areas where a change in attitude on the part of industry could have enormous business and personal implications.

But when these executives go home, will they look around at stressed out employees and suggest that maybe they ought to go home early and have dinner with their families and then get a good night’s sleep? Not just tonight, but every night?

FMI’s Sansolo ended the discussion with a question: Are there any potholes to pursuing these initiatives that we’re not seeing?

To which we have an answer (though he wasn’t asking us):

Only lack of imagination, commitment and execution.

But those are potholes that can be avoided. If retailers so choose.

In other news from the FMI Midwinter Conference…

• FMI presented the 2006 William H. Albers Industry Relations Award, recognizing statesmanship and commitment to forging alliances that benefit the entire food industry, to PepsiCo chairman/CEO Steven S Reinemund.

• The Wakefern Food Corporation received the FMI 2006 Glen P. Woodard, Jr., Public Affairs Award for the company’s outstanding leadership in government affairs.

• And, the Food Marketing Institute (FMI) and the Grocery Manufacturers Association (GMA) announced that they will co-locate two conferences in April: FMI’s Distribution Conference, April 2-5, and GMA’s Information Systems/Logistics Distribution (IS/LD) Conference, April 3-5. Both events will be held at Loews Ventana Canyon Resort in Tucson, Arizona.
KC's View:
Here are the two books that were recommended in yesterday’s FMI sessions. We’re going to track them down, and suggest you may want to as well.

• “Power Sleep,” by Dr. James B. Maas. (We have to be honest here. Maas’s presentation scared the hell out of us, considering how little sleep we get each night. We know from conversations here that it had much the same effect on a number of people in the audience.)

• “Barbarians At The Plate: Taming & feeding The Modern American Family,” by Marialisa Calta.

And one other note. Present for almost the entire day, and on stage for much of the morning, was Supervalu CEO Jeff Noddle…who was balancing his responsibilities as FMI chairman with the task of finalizing Supervalu’s acquisition of Albertsons. Remarkable…though we suspect it makes him at least the temporary poster boy for sleep deprivation.