Moral Crusader Not So Moral
Known for taking an aggressively tough stance against corruption, New York Gov. Eliot Spitzer has been accused of taking part in an expensive prostitution ring. Formerly known as a moral crusader, Spitzer’s work has come back to bite him after it was revealed yesterday that his private life has been less then perfect. His work includes busting crooked Wall Street dealers, fighting big insurance companies, and even exposing prostitution networks (oh the irony!). Spitzer recently set his sights on the alcohol beverage industry in New York.
Recall that Spitzer accused several New York wine and spirits wholesalers and suppliers of “illegal marketing practices” in 2006 when he was still attorney general. New York State’s four largest wine and spirits wholesalers – Eber Bros., Peerless Importers, Charmer Industries, and Southern Wine & Spirits of New York along with their affiliates – agreed to pay $1.6 million and adopt a series of reforms after Spitzer claimed they were in violation of the state’s Alcoholic Beverage in Control Law. New York law prohibits manufacturers and wholesalers of wine and spirits from favoring select retailers and on-premise outlets with discounts, rebates, allowances, free goods and other inducements. The investigation alleged that wholesalers gave discounts to favored retailers, along with gifts such as AMEX gift cards, free trips, iPods, golf clubs and gas grills. In some cases, wholesalers apparently provided free cases of wine and spirits if the retailer was willing to buy certain products in certain amounts.
In a similar investigation, 15 New York wine and spirits suppliers agreed to reform marketing practices and pay $2.3 million in fines. Under the agreement, the suppliers would cease from making any illegal incentives, and were prohibited from financing illegal conduct by wholesalers. The wine and spirits companies that entered the agreement included: Bacardi U.S.A, Banfi Products Corporation; Brown-Forman; Constellation; Diageo North America; E & J Gallo; Future Brands; Absolut Spirits Company; Jim Beam Brands Co.; Kobrand Corporation; Moet Hennessey USA.; Pernod Ricard USA; Remy Cointreau USA.; Sidney Frank Importing Co.; Skyy Spirits.
As you’ve likely heard, Spitzer was caught on a federal wiretap arranging to meet in a Washington hotel room the night before Valentine's Day with a call-girl from the Emperors Club VIP, reports the AP. Spitzer has served as Governor for 16 months, promising to end corruption in the New York government. Many thought he was headed for the Whitehouse.
ARE YOU TRADITIONAL OR SAVVY?
Despite growing wine consumption in the U.S., consumers are reportedly still overwhelmed by wine and/or unwilling to branch out, according to Constellation’s “Home & Habits” study, the second phase of the company’s "Project Genome" study. With the use of Nielsen scan data and online interviews, “Home & Habits” found new insights into the six consumer segments: Enthusiasts, Image Seekers, Savvy Shoppers, Traditionalists, Satisfied Sippers and Overwhelmed. Constellation encourages the wine industry to pay more attention to the “overwhelmed” and “traditionalist” categories especially to ultimately increase their consumption and prompt them to try new brands and varietals.
OVERWHELMED. 23% of consumers fall in this category. Basically, they enjoy drinking wine but are overwhelmed by the huge selection on store shelves. They’d like to receive more help and information when shopping in the wine section at retail stores.
IMAGE SEEKERS. Consumers that view wine as a status symbol make up about 20% of all wine purchasers. They are generally still in the learning stages, and prefer merlot above all other varietals. The internet is their main source of learning about wine. As you can imagine, men and millennials make up the bulk of this category.
TRADITIONALISTS. About 16% of consumers enjoy wines from established wineries, are not as open to trying new brands, and believe wine is most appropriately used during a formal occasion.
SAVVY SHOPPERS. 15% of consumers are “savvy shoppers,” which means they enjoy discovering new wines and varietals on their own. They’re keen on specials, coupons and discounts. They are also more likely to buy a glass of the house wine when dining out to save a few bucks.
SATISFIED SIPPERS. These consumers (14%) do not know a lot about wine and are just fine drinking what they are familiar with. They tend to buy the same domestic brand and drink wine almost everyday. This consumer segment is also more likely to buy a large 1.5L bottle to save themselves a trip to the store. Wine pairings? Forget about it.
ENTHUSIASTS. 12% of consumers consider themselves knowledgeable about wine and enjoy entertaining at home. They tend to be in the middle to upper class and like browsing wine aisles and reading wine publications.
CONTROL STATES BODE WELL IN JAN.
Control state volumes were strong in January, says Melissa Earlam of UBS. Based on data released by NABCA, control states volume grew 2-3% in January 2008, while market volumes grew 3.2% in 2007. Diageo’s January growth was ahead of the market, up 7.5%. The company gained share in January, with strong performances in Canadian whiskey, vodka, gin, rum, Scotch and cocktails. It lost share in Cordials, tequila, domestic and Irish whiskey. Pernod, meanwhile, grew only 2.1% in volume. The French company gained share in rum, cordials and Irish whiskey, but lost share in vodka, Scotch and brandy/Cognac where it is deemphasizing VS growth. Recall that Pernod raised many of its prices at the start of August. In addition, volumes of Brown-Forman grew 2.2% in January, Campari rose 2.3% and Remy jumped 3.9%.
UBS has a buy rating on Diageo, Pernod and B-F. “While we would expect some moderation in US spirits growth in a recession, we still believe market sales growth of 4% to 5% for 2008E in achievable,” said Melissa in a note.
JOHN MACKEY RETAINS CHAIRMAN POSITION
John Mackey avoided another “close call” yesterday (March 10) after Whole Foods shareholders rejected a proposal to create separate roles for the chairman and ceo, according to a report by the Associated Press. Shareholder advisory firm Proxy Governance Inc. had endorsed an advisory resolution that recommended splitting the roles of chairman and chief executive, but the board of directors opposed the idea. Proxy Governance said Mackey embarrassed the company after it was revealed last summer that he had used a phony name to post derogatory comments on financial website about Wild Oats, which Whole Foods recently bought. Mackey also released internal memos and posted a blog on Whole Food’s website that blasted the FTC for attempting to block the Whole Foods/Wild Oats merger. Proxy Governance said Mackey “appeared to be an overly dominant CEO and that the company should bring in an independent chairman to oversee management,” reports the AP.
Until tomorrow, Megan
“We are always in search of the redeeming formula, the crystallizing thought.”
-Etty Hillesum
--------- Sell Day Calendar ----------
Today's Sell Day: 7
Sell days this month: 21
Sell days this month last year: 22
This month ends on a: Mon.
This month last year ended on a: Fri.
YTD sell days Over/Under: +1
Recall that Spitzer accused several New York wine and spirits wholesalers and suppliers of “illegal marketing practices” in 2006 when he was still attorney general. New York State’s four largest wine and spirits wholesalers – Eber Bros., Peerless Importers, Charmer Industries, and Southern Wine & Spirits of New York along with their affiliates – agreed to pay $1.6 million and adopt a series of reforms after Spitzer claimed they were in violation of the state’s Alcoholic Beverage in Control Law. New York law prohibits manufacturers and wholesalers of wine and spirits from favoring select retailers and on-premise outlets with discounts, rebates, allowances, free goods and other inducements. The investigation alleged that wholesalers gave discounts to favored retailers, along with gifts such as AMEX gift cards, free trips, iPods, golf clubs and gas grills. In some cases, wholesalers apparently provided free cases of wine and spirits if the retailer was willing to buy certain products in certain amounts.
In a similar investigation, 15 New York wine and spirits suppliers agreed to reform marketing practices and pay $2.3 million in fines. Under the agreement, the suppliers would cease from making any illegal incentives, and were prohibited from financing illegal conduct by wholesalers. The wine and spirits companies that entered the agreement included: Bacardi U.S.A, Banfi Products Corporation; Brown-Forman; Constellation; Diageo North America; E & J Gallo; Future Brands; Absolut Spirits Company; Jim Beam Brands Co.; Kobrand Corporation; Moet Hennessey USA.; Pernod Ricard USA; Remy Cointreau USA.; Sidney Frank Importing Co.; Skyy Spirits.
As you’ve likely heard, Spitzer was caught on a federal wiretap arranging to meet in a Washington hotel room the night before Valentine's Day with a call-girl from the Emperors Club VIP, reports the AP. Spitzer has served as Governor for 16 months, promising to end corruption in the New York government. Many thought he was headed for the Whitehouse.
ARE YOU TRADITIONAL OR SAVVY?
Despite growing wine consumption in the U.S., consumers are reportedly still overwhelmed by wine and/or unwilling to branch out, according to Constellation’s “Home & Habits” study, the second phase of the company’s "Project Genome" study. With the use of Nielsen scan data and online interviews, “Home & Habits” found new insights into the six consumer segments: Enthusiasts, Image Seekers, Savvy Shoppers, Traditionalists, Satisfied Sippers and Overwhelmed. Constellation encourages the wine industry to pay more attention to the “overwhelmed” and “traditionalist” categories especially to ultimately increase their consumption and prompt them to try new brands and varietals.
OVERWHELMED. 23% of consumers fall in this category. Basically, they enjoy drinking wine but are overwhelmed by the huge selection on store shelves. They’d like to receive more help and information when shopping in the wine section at retail stores.
IMAGE SEEKERS. Consumers that view wine as a status symbol make up about 20% of all wine purchasers. They are generally still in the learning stages, and prefer merlot above all other varietals. The internet is their main source of learning about wine. As you can imagine, men and millennials make up the bulk of this category.
TRADITIONALISTS. About 16% of consumers enjoy wines from established wineries, are not as open to trying new brands, and believe wine is most appropriately used during a formal occasion.
SAVVY SHOPPERS. 15% of consumers are “savvy shoppers,” which means they enjoy discovering new wines and varietals on their own. They’re keen on specials, coupons and discounts. They are also more likely to buy a glass of the house wine when dining out to save a few bucks.
SATISFIED SIPPERS. These consumers (14%) do not know a lot about wine and are just fine drinking what they are familiar with. They tend to buy the same domestic brand and drink wine almost everyday. This consumer segment is also more likely to buy a large 1.5L bottle to save themselves a trip to the store. Wine pairings? Forget about it.
ENTHUSIASTS. 12% of consumers consider themselves knowledgeable about wine and enjoy entertaining at home. They tend to be in the middle to upper class and like browsing wine aisles and reading wine publications.
CONTROL STATES BODE WELL IN JAN.
Control state volumes were strong in January, says Melissa Earlam of UBS. Based on data released by NABCA, control states volume grew 2-3% in January 2008, while market volumes grew 3.2% in 2007. Diageo’s January growth was ahead of the market, up 7.5%. The company gained share in January, with strong performances in Canadian whiskey, vodka, gin, rum, Scotch and cocktails. It lost share in Cordials, tequila, domestic and Irish whiskey. Pernod, meanwhile, grew only 2.1% in volume. The French company gained share in rum, cordials and Irish whiskey, but lost share in vodka, Scotch and brandy/Cognac where it is deemphasizing VS growth. Recall that Pernod raised many of its prices at the start of August. In addition, volumes of Brown-Forman grew 2.2% in January, Campari rose 2.3% and Remy jumped 3.9%.
UBS has a buy rating on Diageo, Pernod and B-F. “While we would expect some moderation in US spirits growth in a recession, we still believe market sales growth of 4% to 5% for 2008E in achievable,” said Melissa in a note.
JOHN MACKEY RETAINS CHAIRMAN POSITION
John Mackey avoided another “close call” yesterday (March 10) after Whole Foods shareholders rejected a proposal to create separate roles for the chairman and ceo, according to a report by the Associated Press. Shareholder advisory firm Proxy Governance Inc. had endorsed an advisory resolution that recommended splitting the roles of chairman and chief executive, but the board of directors opposed the idea. Proxy Governance said Mackey embarrassed the company after it was revealed last summer that he had used a phony name to post derogatory comments on financial website about Wild Oats, which Whole Foods recently bought. Mackey also released internal memos and posted a blog on Whole Food’s website that blasted the FTC for attempting to block the Whole Foods/Wild Oats merger. Proxy Governance said Mackey “appeared to be an overly dominant CEO and that the company should bring in an independent chairman to oversee management,” reports the AP.
Until tomorrow, Megan
“We are always in search of the redeeming formula, the crystallizing thought.”
-Etty Hillesum
--------- Sell Day Calendar ----------
Today's Sell Day: 7
Sell days this month: 21
Sell days this month last year: 22
This month ends on a: Mon.
This month last year ended on a: Fri.
YTD sell days Over/Under: +1
posted at 12:36 PM
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