Archives

Cranberry Stressline

Jan. 8 to Jan. 21, 2000

Coca-Cola

New CEO ushers in radical shift in Coke culture

1/19/00 Douglas Ivester came to Coke a few years ago and quickly impressed Wall Street with his decisive style. His sudden fall from grace came as a surprise, and now with Douglas Daft as the new CEO, it is obvious that a new culture has arrived at Coke. Ivester was a lone wolf, while Daft has moved the highly regarded Jack Stahl from his position as head of North American operations to be his second in command.

Daft, with his international experience, and Stahl with his domestic expertise, are expected to function more as a team in the number one / number two positions.

New York Times Business reporter Connie Hays, who covers Coke, Pepsi and Ocean Spray describes the changes at Coke here.


1/17/00
Quote without comment

"Even though Ocean Spray is in play, or at least investigating the possibility of a merger situation, if I'm a Big Dog in this industry, I'm going after some of the OSC talent.  Imagine marketing as well as they have while working for a bunch of farmers? You think it's easy working with a coop, try it -- most growers wouldn't know "marketing skill" if it ran over 'em."

From: Bob Messenger's Food Trends Newsletter: Reaching the Food and Beverage Industry's Top 1,400 Decision Makers, Nov. 1999 edition; www.foodtrends.com

Editorial

1/15/00 - As the editor of Cranberry Stressline, I frequently have to decide whether or not to publish certain information. Rumors, allegations, descriptions of suspicious activities and actual copies of documents are often shared with me. The ultimate test of whether information goes public on Stressline is whether it meets journalistic criteria; not whether it will offend sensibilities.

Cranberry Stressline is a publication about the cranberry industry, read by people who are interested in the cranberry industry. My obligation to these readers is to publish accurate and complete information relevant to the past, present and future of the industry. CONTINUED | Easy to print version


Australian market now open to California table grapes

1/15/00 The California Table Grape Association announced (Read Press Release) that after years of negotiation with the Australian government, they will be able to ship grape to the sixth largest country in the world. Shipments are scheduled to begin this year, and will arrive in Australia when their own grapes are out of season.


Marketing Committee to simplify, disseminate information

11/14/00 Responding to feedback from growers and handlers from the morning meeting, the CMC subcommittee decided to simplify the presentation when they convened again in the afternoon. The existed printed information was deemed to be rather complex and in need of clarification and simplification.  They will make a mass mailing of a new explanation of how volume regulation works after February 1st. In addition, from February 1st until the next meeting, which is on 2/28 in Washington DC (at the Arlington, VA Ritz Carlton), David Farrimond will be available to speak to any growers or handlers meeting at CMC expense in any grower area.


Commentary:

An "invisible" 900 lb. gorilla in the room
by Hal Brown

1/13/2000 By any account, today's meeting of the Cranberry Marketing Committee's sub-committee meeting on volume regulation was a significant  and unusual event. Held in a meeting room at the Raddison Hotel a mile from T.F. Green Airport in Rhode Island during the first Massachusetts' snowstorm in 300 days, it drew executives from all the cranberry handlers, as well as  about 30 spectator/participant cranberry growers from Massachusetts. CONTINUED | Easy to print version | Read article in the New Bedford Standard Times | Article in The Patriot Ledger

 

 


 

Editorial

If we don't build it,
they will come

1/14/2000 James Tillotson, Tom Gelsthorpe and others have said it. Yesterday at the Cranberry Marketing Committee meeting, Ed Gelsthorpe, a former CEO of Ocean Spray (and Tom's father) also said it. "The only cranberry companies that will compete successfully in the 21st century are those who are successful marketing internationally."

Ed Gelsthorpe pointed out that a volume restriction to stabilize the supply-demand equation was only a short term solution.

CONTINUED | Easy to print version


Cooperatives

Sunkist rebounds with bountiful crop

1/20/00 Sunkist Growers is one of the world's oldest and largest citrus marketing cooperatives. It is owned by 6,500 citrus growers in California and Arizona, most of whom are small family farmers. In a Press Release the coop announced today that after a crop which was hurt by freezing weather last year, this season the weather in California has been excellent. The result is that the navel orange crop is predicted to be twice what it was in 1999. The  Press Release goes on to tout the nutritional benefits of oranges, providing a plug for the product itself which will "ride along" with the press release in publications that choose to publish it because of the newsworthy announcement about the crop. Since the general media only publishes press releases deemed to be of interest to their readers, companies are always trying to issue releases with news that will be widely disseminated. The best example of this in the cranberry industry is the press release about urinary tract infection, which was picked up by virtually all the news media.


Ad Ideas:

Cran for life

1/19/00 According to a study by the California Milk Processor Board its ``GOT MILK?'' slogan was more effective than slogans of top beverage brands, as measured by how well consumers remember advertising taglines. Tagline are short slogans used to create identity for products. "Researchers found that mega-brands such as Coke, Pepsi and Budweiser had less than 17 percent correct tagline recall among consumers. GOT MILK?, by contrast, was correctly remembered by 50 percent of those polled." Could there be an equally memorable tagline which could be used to promote cranberries in generic advertising? How about one with a double meaning: "Cran for life?" Consume cranberries for a lifetime and live a longer and healthier life.

Guzzle O.J. or Savor C.J.

1/18/00 - Let's all hear it for Tropicana as they inaugurate their new advertising campaign during the Super Bowl and tout the fact that a glass of Tropicana is "the Best 9.3 Seconds You Can Possibly Spend on Yourself,'' (Read Press Release). It is true, orange juice is a guzzlers' beverage. Nobody doubts that it's good for you.   Cranberry juice, equally known to be nutritious, is meant to be drunk slowly. It is meant to linger on the palate like a vintage wine.

Here's an idea for a generic ad for cranberry juice. Do a brief spoof of the Tropicana ad with a harried looking actor mainlining his or her nutritive fix for the day in 9.3 seconds. This part of the ad should be shot so it's annoying, and the music should convey a vague sense of anxiety. Then, with calming music, cut to a relaxed scene of a couple or family drinking cranberry juice out of wine glasses with the caption "Cranberry Juice - Savor the Flavor."


On waiting for a world-class CEO
by Hal Brown
Addendum added 11:00AM EST Below

1/16/00 - It is possible that Ocean Spray will continue the search for a new CEO. Unless decisive action is taken to reassure Wall Street that the company is on track, this is likely to lead to a severe downgrading of the Ocean Spray credit rating. More devastating to the Ocean Spray family is the continued lack of effective leadership at the top, which is likely to lead to ill advised business decisions and poor morale.

When the Board meets in Chicago on January 20th, if there is no CEO ready to come on board in a few weeks, it is crucial that an interim CEO be appointed to guide the company until a top notch permanent CEO can be hired. Tom Bullock must not continue as CEO. The Board should appoint the best possible executive from within the company as interim CEO. * He should be charged with the mission of strengthening the company by maximizing sales through cost-effective targeted advertising, assuring that the distribution system functions properly, and exploring every avenue for increasing returns to the growers this year. He should maximize the value of Ocean Spray regardless of whether the new board decides to explore the option of sale or merger.

The interim CEO should have broad authority to hire and fire within the executive ranks and to bring in consultants as he sees fit. He should not, however, be allowed to close plants or cut back on the work force. Decisions of this magnitude, effecting hundreds of loyal employees and their families, should be left to the permanent CEO and the Board.

With a competent and trustworthy interim CEO in charge, who has the full faith of the Board, the grower/owners and the employees, there should be no reason to rush to hire a permanent CEO. We have waited this long for a CEO and with a competent interim CEO in charge, the Board shouldn't set an arbitrary date like the Annual Meeting for having a new CEO in place. It is imperative that Ocean Spray hires a world-class CEO with the focus, acumen, leadership skill, and - yes - vision, to make Ocean Spray a world class company.

It should be a foregone conclusion that first modern Ocean Spray Board to be elected all at the same time will have wide grower support. With this support, the board should set as a second priority, after hiring a new CEO, the change in the By Laws so that a 2/3rds majority is all that is needed to approve a sale of the company.  Whether it is through sale, merger, or another means, Ocean Spray must have a strategy to compete in the global marketplace, or they will be an also-ran in the 21st century. 

* Addendum: Another option is to elect a new Chairman of the Board from the eleven nominated grower/owners; and to appoint him as interim CEO.

Easy to print version


Campbells Soup being sued

11/15/00 Updated 11:00am -  A Boston and a Philadelphia law firm, a Connecticut, and a New York law firm are announcing in several Press Releases  that they are representing  Plaintiffs in a law suits against Campbells Soup.  At least two law suits are being filed on behalf of anyone who invested in Campbells between November of 1997 and January of 1999; and one is being filed on behalf of a multi-million dollar pension fund and anyone who invested in it. It is alleged in the Complaints that Campbells claimed to have ``sold'' product to major distributors or resellers when in actuality Campbell never shipped the product to its customers, and that Campbell claimed these phantom sales in order to meet Wall Street's earnings estimates for the Company and therefore artificially inflate the price of Campbell's stock. The price of Campbells stock is said to have dropped from approximately $54 to $46 and has never recovered. Hence the Plaintiff seeks to recover damages suffered by class members.

Campbells Soup has been mentioned as interested in buying either Ocean Spray or Northland Cranberries.


From the Boston Globe: "For many agricultural cooperatives, 1999 was a year they'd rather forget. One exception: Welch Foods Inc. of Concord."

1/12/2000 - "US farmers have become so efficient that they now routinely produce more than paying customers can eat. With supply often outpacing demand, growers have seen prices for their crops plummet.... Ocean Spray Cranberries Inc. of Lakeville is one visible example of a cooperative that's struggling with oversupply and falling prices."  Read article here | Image


Credit outlook for food industry mixed, Moody's reports

From the report:1/10/2000 - "Over the past year, Moody's has downgraded six companies with significant commodity exposure, placed three under review for possible downgrade, and changed another's outlook to negative. Among these companies are Land O'Lakes, whose preferred stock was brought down to "ba2" as a result of depressed prices in the swine and fertilizer markets and the company's difficulty in adapting to fundamental shifts in the market. Exposures to the swine market also precipitated downgrades of Iowa Select Farms to B3 and Purina Mills to Caa3.

The rating agency has also placed under review Archer-Daniels-Midland (Aa3) as a result of the depression in the oilseed market, and the preferred stock of Ocean Spray ("a3") as a result of weak cranberry prices, oversupply, and a loss of market share that have weakened debt protection."   Read entire Moodys Report here.


Humor:

Too serious?

1/10/2000 Cranberry Stressline has been accused of being too serious, and not serious enough. As readers await news from Ocean Spray as to who the new CEO will be, in response to a number of requests to "lighten up", we offer a link to fifty-plus farmer jokes on The Humor Vault.


Selling cranberries on the streets of Leningrad

1/8/00 According to an article in the 12/20/99 Wall Street Journal (Russian Politics Bear Marks Of Classic Philosophical Divide), cranberries are helping the economically deprived make ends meet in Leningrad:

"Meanwhile, the less fortunate in the new Russia have nothing but contempt for the "young reformers" of SPS (Ed note: the party of economic reform favored by the middle class). A group of old ladies selling cigarettes, dried fish and cranberries at the Leningrad railway station to supplement their $25 (24.80 euros) monthly pensions all cast their votes for the Communist Party."