Are higher gas prices hurting sales of health and wellness items? Let’s face it, higher pump costs are hurting everything. A new survey of some 26,000 consumers by The Nielsen Company in December found that half of them have reduced spending to compensate for the higher price of gasoline.

Measures they’ve taken include more shopping at supercenter formats, using more coupons and buying less expensive grocery brands, as indicated by the chart below.

“Manufacturers and retailers need to be alert to the fact that consumers are looking to save by altering where they shop, how they shop and what products and brands they buy,” said Todd Hale, senior vice president of Consumer Shopping & Insights for Nielsen Consumer Panel Services. “Value, convenience and competitive pricing will be more important than ever in the year ahead.”

The three criteria Hale mentions are not the first that come to mind when thinking about wellness, particularly organics. So, you have to wonder what kind of impact a recession (are we allowed to say that word yet?) is going to have on wellness category growth.

There is one good note sounded in the Nielsen survey. Forty-one percent of the consumers polled also said they planned to eat out less, and 39% said they plan to stay home more often. Supermarkets with flexible whole-health pricing strategies will hopefully be able to do something with those numbers.

Some operators, like Sunflower Farmers Market in Boulder, Colo., already position themselves as the affordable alternative to premium wellness prices. Mike Gilliland, Sunflower’s founder and CEO, noted as much recently, when he announced an infusion of $30 million in equity financing from private investors to expand the 13-store chain.

“There is tremendous demand for an alternative to the high price format that has predominated in natural foods for so many years,” he said.

Sunflower’s motto also fits in with the times: “Serious Food… Silly Prices.”

Higher gas prices likely would have less of an impact if the economy were stronger. Unfortunately, the one-two combination here makes it even less likely consumers are springing for higher-priced organics and wellness products. If anything, the current state of the economy will likely accelerate the growth of retailers like Gilliland, who emphasize the value segment of the natural and organic categories.

It seems everyone is getting into carbon offsets these days: Banks, colleges, restaurant chains, airlines — and supermarkets, to name a few. Even cultural institutions like the Academy Awards and the Super Bowl have joined in. Many claim to be “carbon neutral,” which means all emissions created by the entity have been met with an equal dose of earth-friendliness. And then there are some, like the Fiji bottled water company, that say they’re carbon negative. According to Fiji, this means implementing business practices and projects that will trap more greenhouse gases than the company pumps out.

It’s hard to argue with a goal that helps the environment. But as carbon-offset programs become more popular, there arises a concurrent opportunity to misrepresent claims. Part of the problem is the actual offsetting doesn’t get done in a company parking lot. Oftentimes it’s planting trees in South America, or subsidizing wind turbines hundreds of miles away. It’s something customers don’t see and that companies themselves cannot easily monitor. The actual business of administering offsets is outsourced to third-party firms.

The Federal Trade Commission is worried enough about the volume of carbon-free programs and the way the system currently works that it’s holding a series of fact-finding meetings. FTC rules on green marketing haven’t been updated in more than 15 years, and part of the strategy here is to warn businesses the agency is looking for abuses, and intends to follow the issue.

Retailers like Whole Food Market, which announced in 2006 the purchase of enough wind credits to offset 100% of the electricity use in all its stores, are right in the middle of the movement. Some retailers have even offered gift cards that bestow offsets upon the receiver. As both a participant in the practice, and a merchandiser of it, it’s important to note that retailers assume a double risk if their carbon offset programs are found to be less-than sterling.

In cases like these, it’s wise not just to follow where the wind blows. Study the organizations that sell credits and be sure they uphold their part of the agreement.

Advocates for water conservation have adapted a term being used by their carbon-reduction cohorts for a new campaign that invites Amerricans to measure their water “footprint.”
A new website, www.h2oconserve.org includes an H2O calculator that allows visitors to determine just how much water they’re using (which turns out to be, on average, just under 1,200 gallons a day).
After that cold splash of realization, consumers are invited to learn some tips for reducing water consumption and guided to sources of additional information.
One thing retailers should note is that a companion news release called on other organizations and government institutions to encourage consumption of public water supplies, rather than H2O sold in plastic bottles. So, it appears this anti-bottled water campaign is continuing. The organizations behind h2oconserve.org — Food & Water Watch, Interfaith Center on Corporate Responsibility, Johns Hopkins Center for a Livable Future and Grace — even sent us a reusable water bottle. It’ll replace the paper cups we get every morning from the water cooler.
If they haven’t already, supermarkets might want to review their bottled water sales and consider adding a selection of alternative containers, along with some educational literature promoting consumer choice, and see how the idea floats.

The spinach scare of 2006 and rash of meat recalls from this past year have made retailers anxious for a fresh start. That’s why many are making improved food safety their top resolution this new year.

Of the many areas that food safety addresses, it appears traceability leads the list in 2008. On the produce front, there’s the Produce Traceability Initiative, holding its first meeting tomorrow in Atlanta. Comprised of more than 30 companies throughout the food industry — including Wal-Mart, Safeway, Food Lion, Schnuck Markets and HEB — the group looks to create traceability standards that will apply across the supply chain. Right now inefficiency runs rampant, often with each step in the process — from producer to distributor to retailers and stores — utilizing different tracing technologies.

This means a grower might tag a carton of tomatoes with its own scanning code, which then gets sent on to a distributor who can’t read or store that information because they use an entirely different system. The result: a negation of all traceback efforts, and a huge waste of money.

“Companies think they have traceability solved, but they only have it solved within their own four walls,” said Gary Fleming, VP of industry technology and standards for the Produce Marketing Association. “Right now, we’re all over the board.”

The meat category is an even more complex maze of tracing systems — everything from electronic ear tags to DNA cataloging. The U.S. Department of Agriculture is pushing its National Animal Identification System, which involves electronic tracking tags; earlier this year Michigan became the first state to make parts of the program mandatory. But the meat industry has resisted the idea, mainly out of cost concerns.

Although produce is definitely ahead of the curve, it’ll take time to resolve traceability for all fresh food categories. Hopefully we’ll see this resolution at the top of retailer’s lists next year, as well.

Dessert is a subject we love to write about because it’s not something you typically get to discuss in the wellness business, unless it’s about portions and fat and similar topics that take all the fun out of eating it in the first place.

Luckily, there’s a trend currently working its way through in-store bakery cases across the country that satisfies both dessert fanatics and calorie-counters. It’s basically a miniature version of popular desserts crammed into what can best be described as shot glasses. They were spotted just before the holidays being introduced in the upscale King’s Super Market chain in New Jersey. The Duo Mousse Shots are available in four varieties: Chocolate, Coffee, Crème Caramel and Raspberry Lemon.

At least two casual service restaurant chains, Chili’s Grill & Bar and T.G.I. Friday’s, have offered them since the fall. Chili’s calls them Sweet Shots, with names like Seven Layers of Chocolate, Strawberry Wave Cheesecake and Dutch Apple Caramel Cheesecake. Friday’s put them on their revamped menu as Mini Dessert Shots (pictured), in Rocky Road, Chocolate Raspberry, Peanut Butter Cup, Chocolate Chip Mint and Orange Cream.

Chefs who responded to the National Restaurant Association’s annual “What’s Hot & What’s Not” survey named bite-sized desserts the hottest of the 194 items ranked, with more than 83% calling it “hot.” This could be a real neat way to get wellness shoppers to visit the ISB for more than artisan bread and gluten-free cookies. These spoon-size items are real desserts with portion control built in. Retailers can develop a whole bunch of fun flavor profiles, and offer them bundled — either themselves or with family fresh meals.

Who says dessert has to be served last in the whole health movement?

It’s one of the obvious ironies retailers need to resolve if they want to honestly project an image of authenticity. Why do stores offering health and wellness products also sell items that have a proven track record of killing people?

We’re talking about tobacco, and so was Wegmans Food Markets when it announced earlier this week that it will stop selling cigarettes and other tobacco products in all 71 stores as of Feb. 10. According to a brief in The Buffalo (N.Y.) News, the retailer will allow current inventory to sell out until then.

People can argue that the job of any retailer is to offer variety and choice — not to be a meddlesome entity that edits consumer choice. True enough. But in the case of tobacco, it’s time the supermarket industry caught up with public policy, which has been banning smoking in all sorts of venues over the past 20 years.

Category sales are falling anyway, and stores operate under the constant threat of sting operations testing prohibitions on sales to minors. Who needs the headache?

Berkeley-based food thinker Michael Pollan used his last book, “The Omnivore’s Dilemma,” to examine how we Americans get our food. This time, he’s looking at the food itself. His latest book, “In Defense of Food: An Eater’s Manifesto,” is hot off the presses at Penguin.

You might not think retailers — all food industry types, actually — need to read these types of deep-thought, meditative books, but they should. Not only are their customers reading it (purchased from their very own in-store book sections, perhaps?), they’re using Pollan’s logical, even-minded insights to reconsider how they eat. In turn, that influences how they shop.

Pollan’s philosophy is evident on the cover of his latest tome, when he writes: “Eat food. Not too much. Mostly plants.” Translated, it means buy authentic, simple foods, found in the perimeter departments, preferably produce. Great. No problem. That’s what many shoppers are trying to do already. What Pollan does here, in his own inimitable way, is reinforce that desire with a grounded, logical argument that appeared in earlier stories he did for The New York Times Magazine.

So far, it’s getting strong reviews, so it’ll likely do as well as Omnivore did when it was published in 2004. If Oprah even mentions it, however, watch out. Better get your copy now.

Green this, eco that, but take note: Monsanto Company announced today that its latest quarterly profits nearly tripled. Your wellness shoppers will find it ironic that the increase was due, in large part, to the strength of its herbicide business, which includes the popular RoundUp brand (the other growth area was corn seed).

Many consumers have placed Monsanto in their pantheon of corporate villainy. It’s the giant, faceless conglomerate, casting its large, very dark shadow over American agriculture. The list of crimes cited by activists is short but significant: Monsanto pioneered genetically modified corn and soy plants; created recombinant bovine growth hormone (rGBH); and has asked federal regulators to ban “hormone-free” labels on dairy products.

Yet, here it is, flush with cash and raising its forecast for 2008 upwards of $0.20 a share. This is coming off a stellar 2007, when the company’s stock price more than doubled, from $52 per share to almost $112 by the end of the year.

We’re not going to pretend to know why this is. All sorts of factors are at work. However, a recent story in Business Week described a critical strategic change after Hugh Grant took over the CEO’s office in 2003. After years of deflecting public criticism over its products and activities, Monsanto began focusing on four commodity crops, including corn and soybeans. The industrial-grade products were suitable only for processing plants, and far removed from supermarket shelves and restaurant menus. Consumers no longer had all this GMO news in their faces, and the opposition began to quiet.

As a result, the Grocery Manufacturers Association reports that, up to 70% of all processed foods made in the United States today contain GMO commodities.

Love ‘em or hate ‘em, you have to admit that Monsanto deserves credit for playing smart.