Monday, March 1, 2010

Wine Shelf-Talkers: Consumer Aid or Consumer Fraud? (update)

Last night I took Fresh Market to task for deceptive advertising. I followed up my blogged complaint by, once again, calling the company. This time I managed to get to the right person. I spoke to Fresh Market’s Merchandising Coordinator for Beer & Wine. He agreed that there was no excuse for the deceptive shelf-talker. Interestingly, he noted that Fresh Market stores are not supposed to use winery-supplied shelf-talkers either. He told me that Fresh Market’s regional or district manager was going to be in the store today and would make sure that the shelf-talkers in place were accurate. He was very polite and clearly understood the seriousness of the issue. For that I give him and Fresh Market credit.

In some ways, this reminds me of my complaint to Regal Cinema (and the follow-up with Pixar).

I admit it: From time to time, I can be a real pain in the ass. But when I see something that is fundamentally wrong, I have no problem saying so and calling to task those responsible. By the same token, when things are fixed, it becomes my responsibility to say so. I’ll try to stop by Fresh Market later this week to see what sorts of changes have been implemented.

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Sunday, February 28, 2010

Wine Shelf-Talkers: Consumer Aid or Consumer Fraud?

If you’ve ever wandered around a liquor store or the alcohol section of many groceries, you’ve no doubt seen how many different bottles of wine are available for purchase. Unless a consumer has previously tried a particular bottle or had one recommended by a trusted friend, how is a consumer supposed to choose a bottle? After all, from the hundreds, even thousands, of different wines available, there are dramatic differences in quality and taste, not necessarily associated with price.

Better liquor stores (and even more so with wine shops or liquor stores specializing in wine) have employees (or proprietors) who are familiar with as many of the wines as possible and, even if not familiar with a particular bottle, usually have some knowledge of the producer or other information from which they can help a consumer make an informed decision. The best employees of the best wine shops and liquor stores know the right questions to ask of customers to learn their particular palates in order to recommend appropriate wines. But at your run-of-the-mill liquor store or grocery store, there is simply no way to have employees this knowledgeable about the wines and customers or willing or able to devote the time (and expense) to learn about the wines and customers. Try asking an employee at most grocery stores whether a particular bottle of wine is any good and you’ll most likely get a blank stare or a simple “Uh, I dunno”.

My mother used to own a women’s clothing store. One of her strengths was knowing her customers’ tastes (not to mention what they’d previously purchased). Thus, if a husband came into the store and wanted to buy his wife a present, my mother could direct him to something that she knew the wife would like (and look good in and didn’t already own). A similar philosophy must work for a wine store: If the proprietor learns what I like and consistently recommends wines that I do, in fact, enjoy, then I will continue to respect and follow his advice (and shop at his store). By contrast, if the proprietor recommends wines that I do not like or doesn’t take the time to learn my palate, then I have no reason to trust his recommendations (or frequent that store).

But not everyone has the time to develop a palate, to shop at a specialty wine store, to get to know the proprietor (or allow the proprietor to get to know them), or, perhaps most importantly, to spend much money for a bottle of wine. How then can a consumer decide which of the numerous bottles available at the local grocery or regular liquor store to buy? How do you separate the good from the mediocre from the swill?

One method employed by many stores (and eschewed by many others) is the “shelf-talker”. This is usually a small note displayed by the bottle to tell the consumer what to expect from that particular wine. Within the wine community, there is some controversy about the use of shelf-talkers. For myself, I recognize the usefulness of shelf-talkers, but am often wary. A recent incident (discussed at the end of this post) led me to take the time to write about shelf-talkers.

On the positive side, the use of shelf-talkers can to some extent help a consumer with no other information “get into the game”. If the store carries 500 different bottles of wine, there would most likely be no other way for a consumer to make a choice other than buying based solely on price or brand name. But in the case of wine, more so than almost any other product I can think of, there is far, far more than just price or brand that needs to be considered. You can buy a lot of very good wines for $10; but you can buy even more bad wines for that price. You can also buy a lot of very bad wines for far more money. And a winery that makes a very good $10 Merlot doesn’t necessarily also make a good $10 Riesling, so reliance upon brand doesn’t work quite so well, either (and add to this the fact that many brands make only one or two varieties and thus may have no brand recognition beyond wine connoisseurs). Plus, just because that Merlot was good last year doesn’t mean that it will be good this year.

So when a consumer walks into a store that does use shelf-talkers, they can be quite helpful. Knowing that a particular wine won a medal at a prestigious wine competition or was highly recommended or considered a best value by a respected wine magazine can do quite a lot to help a consumer make an informed decision. If there are 20 bottles of $10 Merlot and one of them received a “Smart Buy” rating from Wine Spectator and another has a 92 rating from Wine Enthusiast, then the consumer at least has something on which to base a decision and a reason to choose one wine instead of another. (I’m not going to get into the issue of how various wine magazines make their ratings or whether there is bias; that is a complicated and controversial enough issue for another day.) So, in that respect, shelf-talkers can be a valuable aid to consumers. Similarly, a shelf-talker that helps a consumer know what to expect from the wine or suggest food pairings can also be quite useful (especially for a consumer interested in trying a more “exotic” wine).

Given that, why would a store choose not to use shelf-talkers (presuming that it doesn’t have knowledgeable employees)? Here’s one simple reason: Take two bottles of Merlot, one costing $10 and the other costing $20. Now presume that the $10 bottle gets better ratings (or wins more awards, or whatever) than the $20 bottle. How many consumers are going to choose the lesser-rated, more expensive bottle? Obviously, the store has more incentive to sell the more expensive bottle.

So a shelf-talker can provide good information to a consumer, but not necessarily to the benefit of the store.

But there are downsides to consumers, too (and, unfortunately, these may be to the benefit of retailers).

First, many stores that do use shelf-talkers, use them selectively; that is, only some wines have an associated shelf-talker. How does the store decide which wines will get shelf-talkers and which won’t? One possibility is that poorly-rated wines don’t get a shelf-talker while highly-rates wines do. However, experience suggests that this reasoning is not employed. I’ve seen plenty of stores with shelf-talkers on mediocre wines while very good wines have no associated shelf-talker. Thus, when a consumer sees selective use of shelf-talkers, the consumer should at least consider why the store has chosen to use them only selectively. Why this bottle, but not that bottle? Perhaps the use of a shelf-talker is more indicative of wines that the store is working hardest to sell (perhaps there is a glut in the storeroom or the store got those bottles at a particularly good price). Or perhaps the store has been paid by a particular winery or wholesaler to utilize shelf-talkers for its wines. In some respects, use of a shelf-talker may not be much different than the way the grocery chooses to put a particular brand of cookie or soft drink in its Sunday circular.

The other downsides for consumers are more troubling, sometimes (as we’ll see), even fraudulent.

Many stores use a shelf-talker that recites ratings (usually from wine magazines) for the past several vintages. For example, at Fresh Market or Costco, you’re likely to see a shelf-talker that says something like this:

2007: No rating

2006: 90 Wine Spectator

2005: 91 Wine Enthusiast

2004: 88 Wine Spectator

Generally, that shelf-talker is “fair”. But what if the 2007 vintage has been rated subsequent to the time that the shelf-talker was printed? If the wine got a good rating for 2007, I guess it’s mostly a case of “no harm, no foul”. But what if the 2007 vintage received a poor rating? If the store is trying to sell the wine on the basis of past good ratings, then isn’t the more recent poor rating relevant? Certainly, the store shouldn’t be expected to revise shelf-talkers daily, but shouldn’t a consumer be able to expect that a statement that a particular wine hasn’t been rated is at least a reasonably up to date statement?

This example above also illustrates another frequent problem. Note that the 2004 and 2006 vintages cite Wine Spectator while the 2005 vintage cites Wine Enthusiast. Why? Maybe the 2005 vintage wasn’t rated by Wine Spectator; if not, it is certainly fair to cite another source for a rating. But what if Wine Spectator’s rating for 2005 was 82? In this case, is it fair to cite good ratings from one source but when that source gives a poor rating to change to a source that gave a better rating? On one hand, as long as all of the sources are reputable, what’s wrong with choosing the source that gave the best rating? On the other hand, something just seems “wrong” with changing sources mid-stream, when the only reason is to avoid noting a poor score.

Shelf-talkers like that in the above-example are also known to employ an additional bit of deception. Occasionally, you’ll see the list of vintages omit a particular year. In my experience, that is almost always a sign that the store is trying to hide a bad rating for a particular vintage (rarely it is because that particular wine was not produced that particular year). This practice also seems “wrong”; moreover, I don’t really understand this practice given that the store is not trying to sell the wine that received the bad rating anyway.

Another thing to look for on these kinds of shelf-talkers is the use of lots of different sources for ratings, especially sources not usually considered among the “usual suspects”. Different people have different opinions about the ratings of different sources, but generally Wine Spectator, Wine Enthusiast, and Wine Advocate (Robert Parker) are reasonably well-respected. Wine & Spirits and Steven Tanzer are also reasonably well-respected, though not used as commonly as the first three. But there are numerous other sources that you may see on shelf-talkers from time-to-time. Unfortunately, most consumers who don’t read wine trade magazines have no idea who these sources are and have no reason to respect one more than another. So query the “fairness” of using the lesser-known sources. It’s a bit like when a newspaper prints a movie review by the reviewer for the North Podunk Post rather than a review from the New York Times or one of the well-known reviewers from one of the major papers or magazines. Why should a consumer give any credence to that reviewer’s opinion? This issue may be exacerbated in the case of wine magazines where there is a lot of speculation (maybe even evidence) that some sources (maybe even the well-respected sources) employ a “pay-for-play'” methodology; that is, wineries who advertise with that periodical tend to get more favorable treatment. Maybe yes, maybe no. But certainly it would be improper for a shelf-talker to quote a periodical where the reviews are not presumed to have some degree of impartiality and independence.

Another common “trick” employed on shelf-talkers is to mention awards that a particular wine has won. “Gold Medal at 2008 Santa Fe Wine Competition” for example. Here’s the problem: Is the Santa Fe Wine Competition a good competition? Is it even a real competition? If I tell you that a film won an Academy Award, you know what that is and you know that’s an impressive achievement. Of course, if I failed to mention that the award was for editing, rather than for best picture, you’d probably be a bit miffed. And what if I tell you that a movie won the Journalist’s Guild Achievement Award (no such thing as far as I know…)? In the world of wine, there are hundreds if not thousands of contents and awards a wine could wine, but how many are really important? But if you don’t follow wine closely, how would you know which of those awards are meaningful? Recently I was shopping at a reputable wine store with good, knowledgeable staff. I asked about a particular bottle and the clerk laughed and told me that it had recently won a gold medal. But then he laughed again and told me not to get too excited; the gold medal, he told me, came at the San Antonio Rodeo Wine Festival.

One of the more troubling practices (though I’ll admit that it may be a function of carelessness) is having a shelf-talker that doesn’t match the vintage of the bottle being sold. I’ve seen that at Kroger with some frequency. Kroger’s shelf-talkers do tell the vintage of the bottle that the review applies to (well, at least usually), but it is not always easy to find the vintage on the shelf-talker. Many times I’ve seen a shelf-talker telling me that a particular wine had a good rating only to discover that the shelf-talker and rating were for the previous vintage, not the vintage actually for sale. If both vintages received good ratings, then again, “no harm, no foul”. But if the vintage being sold received a worse rating, especially a much worse rating, then is it fair for the store to use that old shelf-talker? I wonder the extent to which the average consumer recognizes the difference in quality from vintage to vintage and that a 91 rating for 2007 may not translate to another 91 rating for 2008. I suspect that in most cases this is a case of carelessness; the original shelf-talker was printed when the wine was first put on the shelf and nobody took the time to replace that shelf-talker when bottles of the new vintage were added. But is that kind of carelessness acceptable? After all, we don’t accept it as acceptable carelessness for a store to continue to sell meat or other products beyond their expiration dates. And we certainly wouldn’t view it as acceptable for a store to put a false expiration date on a loaf of bread or carton of milk.

I’ve also seen the inverse of this problem. Recently at Costco, I saw a shelf-talker that mentioned the 2006 and 2007 ratings (both of which were good). The problem was that the wine being sold was the 2005 vintage. Hmm. That doesn’t strike me as the same kind of carelessness. Is it simply an effort to provide the consumer with some kind of information upon which to base a decision? Or is it something less noble?

Finally, I want to address a very specific instance of the use of a shelf-talker that I recently encountered that was, in my opinion, the most deceptive use of a shelf-talker that I’ve ever seen. In fact, this particular shelf-talker went beyond mere carelessness or somewhat deceptive sales practice to outright consumer fraud.

On February 13, 2010, I visited the Fresh Market at 2490 E. 146th Street in Carmel, Indiana. I enjoy taking a few minutes to look at the wines that are available. In the rear of the store, just across from the seafood counter, was a freestanding display stand with several wines. What I saw caused my jaw to drop. Here’s a photograph of the shelf-talker that I saw (note that this photo was actually taken on February 26; the display had changed slightly [more on that below], but the shelf-talker appeared to be the same):

photo So what’s wrong with this shelf-talker? Here’s a photo of Wine Spectator’s #1 Wine of the Year for 2008:

Casa Lapostolle Clos Apalta 2005Do those bottles look the same? Nope. The wine for sale at Fresh Market is the Casa Lapostolle Cabernet Sauvignon Rapel Valley 2007. Wine Spectator liked the wine and gave it rating of 86 (the link may be password protected; sorry). But it wasn’t the 2008 Wine of the Year. That honor went to another wine from the same Chilean winery: Casa Lapostolle Clos Apalta Colchagua Valley 2005 (a blend of Carmenère, Merlot, Cabernet Sauvignon, and Petit Verdot). That wine received a rating of 96 and has a suggested price of $75. While an imperfect analogy, it’s a bit like telling a consumer that the Chevy Cobalt available at the local dealer is the car that won the Daytona 500! A Chevy may have one, but it certainly wasn’t the one on the dealer’s lot.

How many people bought a bottle of that 86-rated Cabernet Sauvignon thinking that they were getting an incredible buy on the 2008 Wine of the Year?

When I saw this shelf-talker I was furious because I worried about how many people would be mislead. (I knew what the 2008 Wine of the Year was because I happen to read Wine Spectator and enjoy reading about the top wines that I’ll most likely never get to try.) I walked over the store’s main wine section to see if the misleading shelf-talker was repeated. It wasn’t. Instead, I saw this shelf-talker:

photo Note that while this shelf-talker (obviously produced by the winery or its distributor, not Fresh Market) is being displayed on the bottle of Cabernet Sauvignon, it clearly highlights the Clos Apalta. So a customer who was shopping in the main wine section of Fresh Market would have seen this piece of advertising as opposed to the clearly false shelf-talker at the other side of the store. One other thing to be noted: If you look at the first photo above (which, recall, was taken on February 26, not February 13), you’ll see a bottle (at the far right) with the advertising shelf-talker displayed above (along with another advertising shelf-talker). However, when I first encountered the misleading shelf-talker on February 13, it was the only shelf-talker in use for the Casa Lapostolle wine on that display.

Before I finished my shopping that day, I encountered saw a Fresh Market employee that I guessed to be the manager. I asked him if he was the manager and he confirmed that he was. I explained the problem with this particular shelf-talker to the manager. He seemed to understand, but didn’t seem to take it too seriously. I then asked him how many customers might have bought this wine thinking that they were buying something else entirely and whether that was fair. Then he seemed to get it. He said that he’d “look into it” but told me that “these things” are handled by the “wine guy” at the corporate office.

Last weekend (February 20 or 21) my wife was at that Fresh Market. I asked her to look for the misleading display and she confirmed that it was still in place. So twice this week, for no good reason other than the fact that I was angry, I called Fresh Market’s corporate number to complain. Each time, the voicemail system directed me to a mailbox that was full. On February 26, I went back to the Fresh Market. The misleading display was still present (though the display stand had been rotated) and the additional advertising shelf-talkers had been added to a few of the bottles. In addition, back in the main wine area, another large display had been set up:

photo The misleading shelf-talker is not used on this larger display. What is worth noting (remember the discussion above changing sources) is that the big shelf-talker in this photo refers not to Wine Spectator (which gave the wine a rating of 86), but rather to Wine Enthusiast which gave the wine a rating of 90. Gee, I wonder why Fresh Market used Wine Enthusiast here instead of Wine Spectator?

I’m not sure what more to say (I know, I know; I’ve said enough already). Fresh Market is advertising a product in a highly deceptive, even fraudulent way. The store manager has been told about the problem, but it has not been remedied. I can only wonder whether there are other similar issues at Fresh Market; can I believe anything that they tell me or is a lie an accepted part of the Fresh Market business model? I understand that mistakes happen. Perhaps the shelf-talker was a originally a mistake. But for the deceptive shelf-talker to remain for two weeks after the manager was told about the problem takes this out of the realm of mistake and into the realm of … um … something else, something far worse.

On the whole, I still like shelf-talkers. They give me some ideas and help me compare one wine to another. However, I’m always very, very cautious because of the frequency that they are untrustworthy. I think that retailers should use shelf-talkers judiciously, but they should be careful that the shelf-talkers that they use are accurate. The goal should be to help the consumer, not mislead; to sell, without cheating. On the whole, I think that retailers will, in the long run, make more money by treating consumers fairly and providing helpful information rather than by failing to provide information, providing incorrect or deceptive information, and making the quick buck at the expense of customer trust.

What do you think of shelf-talkers? Do you read them? Do you rely on them? Have you seen deceptive shelf-talkers? Let me know.

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Friday, January 22, 2010

How to Recapture Democracy from Corporate Money

Yesterday the Supreme Court of the United States ruled in Citizens United v. FEC that campaign financing laws that prohibited corporations from directly spending money on campaign advertisements violated the First Amendment free speech rights of those corporations. In doing so, the Supreme Court overruled (or ignored) nearly one hundred years of jurisprudence and precedent (and isn’t that just the sort of “judicial activism” that so incenses the right?). The concern with this ruling is that corporations (especially large corporations) will be able to spend large amounts of money to influence elections notwithstanding that the expenditures of large amounts of money in that way is seen to have a corrupting influence on elections and also may have the effect of rendering an individual citizen’s voice even less relevant. By the way, I do recognize that the Supreme Court’s opinion also appears to let unions spend on political advertising in the same way; my comments here, though addressed to corporations, should also be thought of as applying to unions, too.

The perception (which could, I suppose, be wrong) is that this ruling benefits Republicans who are generally seen as being more closely aligned with “big business”. Just imagine what the next election will look like if the drug companies and insurance companies are able to spend unlimited amounts of money on campaign advertisements (and you thought all of the ads for Viagra, Cialis, and Levitra were obnoxious…). Or just think of the impact locally if a particular corporation was denied a zoning variance. What might the next mayoral or city or county council election look like. Another concern worth noting is the possibility that foreign-owned corporations could spend money to influence American elections. Just imagine if Hugo Chavez decided to have CITGO (now owned by Venezuela) or if China used any of the corporations that is has purchased to air campaign advertisements.

So what can be done to rectify the problem? First, straightforward revisions to campaign finance laws probably won’t work, especially while the right holds a 5-4 majority on the Supreme Court. For that matter, while the Republicans hold their 41-59 majority in the United States Senate, it will be tough to get anything to pass there, either. But presuming that Democrats could get a Republican or two (Sen. McCain, for example, co-sponsor of the McCain-Feingold campaign finance law, and a strong supporter of campaign finance reform…), what sorts of laws might solve the problem without running afoul of free speech issues?

So, here are just a few thoughts that I brainstormed (but note that I haven’t read the Supreme Court’s opinion); I admit that I haven’t worked through all of the ramifications, but it was a fun exercise:

  • Congress (or a state that wanted to limit the actions of corporations in that state’s elections) could pass a law that provides that corporations (which, you’ll recall, must be incorporated or organized according to the law of a particular state; they’re not born like, say, humans) can only spend money on campaign advertisements if a majority of shareholders approve of the expenditure. That should have nothing to do with First Amendment issues, as the law deals with corporate governance instead. The law could even provide that only individual shareholders (not other corporations) would be entitled to cast votes in such a corporate vote. Or maybe the law could provide that only shareholders eligible to vote in the election in which the advertisement would air would be eligible to vote on whether the corporation should expend the funds to advertise in that election campaign. And imagine if the law required the prospective advertisement to be shown to shareholders not less than, say, 90 days before any vote could be taken. And maybe, to pass, the advertisement would need the affirmative approval of 60% of the shareholders (after all, it apparently takes 60% to pass any legislation in the Senate…).
  • A law could be passed that would require the CEO of the corporation (or even the entire board of directors) to be filmed and shown in the advertisement saying “I approved this ad” much as candidates have to do now in their own ads.
  • Ordinarily, the standard for defamation is much more difficult to meet when a “public figure” is the target of the allegedly defamatory statement. In many jurisdictions, to be found liable of defamation against a public figure, the speaker must be found to have acted with actual malice (rather than just being shown to have made a false statement). Perhaps we could pass a law that would lower that standard to be the same as applied to allegations of defamation against non-public figures when the alleged defamatory statement is made in the context of a campaign advertisement. While corporations may now have a constitutional right to free speech, they have no constitutional right to a different standard to be applied in determining whether speech is defamatory. At least with this approach, corporations would most likely tend to be careful of what they might say about a candidate that the corporation opposed.
  • I’m not sure if this would fly, but what about a law that taxed, at a much higher rate, the fees received by media outlets for campaign advertisements, but provide a safe harbor if the fees were received from a not-for-profit or candidate?
  • Or we could enact laws similar to those for non-profits that provide that a non-profit is allowed tax-exempt status only if it refrains from certain forms of political advocacy. We could provide a base corporate tax rate of 99% but provide that the rate would be reduced if the corporation refrained from certain forms of political advocacy.
  • We could require corporations who spend money on election advertisements to provide a copy of each advertisement to each and every shareholder of the company (imagine the cost of having to send DVDs of each advertisement to each of potentially millions of shareholders). Remember when AOL used to send all those CDs?
  • Here’s a nasty little idea: We could provide that in the event of a corporate bankruptcy, the debts of a corporation are not wiped out to the extent of spending on election advertising and that the shareholders would be responsible for those outstanding debts to the extent of that spending.
  • Or how about a law that provides that only corporations that pledge not to expend funds on campaign advertising are entitled to enter into contracts with the government.

Well, that’s all I’ve come up with so far. What do you think? Setting aside whether Senate Republicans would ever sign on to any of these sorts of proposals, would any of these ideas help restore balance to the electoral process?

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Wednesday, July 29, 2009

Indiana's Arcane and Archaic Alcohol Laws

Anybody who has ever purchased beer or wine in an Indiana grocery store should be well aware of some of the dumbest laws in the country. For those unfamiliar with Indiana's arcane and archaic alcohol laws, let me give a quick introduction. Rather than simply explain the laws, I'll use a scenario or two to illustrate.

So, it's late on Saturday afternoon and your wife tells you that some friends are going to come over and you're going to grill some burgers. Sounds great. She tells you to run up to the grocery to buy some burgers and beer. You hop in your car, run up to the corner grocery, and get ready to make your purchases. The burgers are easy. The beer? Well that's another story. Because your friends are coming over soon, it would be great to have some cold beer, wouldn't it? But this is Indiana and you're in a grocery store. Sure you can buy beer and wine and maybe other types of spirits, but guess what? You cannot purchase cold beer. Nope. Not in an Indiana grocery store. For that, you'll have to go to a package liquor store.

You decide that you'll just throw the beer in a cooler when you get home instead of running to a second store (and besides, you know that you'd probably pay more for the beer at a liquor store...). After all, your friends will be over soon. So you get in line to pay for your purchases. A young girl, probably in high school, is ringing up purchases for customers. When your turn comes, she smiles and starts to ring up your items. She runs the burgers and chips and paper plates over the bar code scanner until all that is left is the beer. But instead of taking the beer out of the cart and running it over the scanner, she presses the intercom button and asks for assistance in her aisle. What? She notices your perplexed look and explains that she isn't yet 19 so she isn't allowed to sell you the beer. After waiting a few minutes (much to the annoyance of the customers in line behind you), another, older, cashier comes over, picks up the beer, runs it over the bar code scanner, presses a button on the cash register, and then walks away. The original cashier finishes the transaction and collects your money. The bag boy -- who can't be more than 15 or 16 -- picks up the beer, puts in a grocery bag, and then offers to carry your bag to the car for you.

Of course, had it been Sunday afternoon, the grocery wouldn't have been able to sell you the beer at all...

Did you get all that? Let me summarize. Among Indiana's idiotic alcohol-related laws, is a prohibition on grocery stores selling cold beer (if I recall, package liquor stores are prohibited from selling milk; I'm not sure if the prohibition is only for cold milk or if they can sell condensed milk...) and a cashier has to be at least 19 to lift the alcohol out of your cart and run it over the scanner but can take your money for the alcohol. And there doesn't appear to be any age requirement for a bag boy to carry the alcohol out to a car.

I have not taken the time to go find the actual statutes or rules that are operative here; it didn't really seem worth the effort. After all, the question is really one of policy, not implementation.

I suspect that the "no cold beer" law is some sort of protection for the package liquor stores (who most likely are able to charge more for the cold drinks that they can sell). So, I guess that the pros and cons of that law really come down to purely economic issues. But I would query why the package liquor stores need that type of protection from the state. Either their business model is sound or it is not. After all, isn't that what people have been saying of late about all sorts of businesses and industries...?

But I really don't understand the need to have a 19-year old scan the alcohol. First, why are we treating a 19-year old differently than an 18-year old? They're both adults, yet neither is old enough to drink (whether the drinking age should be lowered to 18 may make an interesting discussion for another day). So why is 19 the "magic" age? Furthermore, why is it a problem for an 18-year old to pick up a case of beer and run it over a bar code scanner but acceptable for that same 18-year old (or an even younger employee) to put that case of beer in a bag and/or carry it to a customer's car? And don't forget that the 18-year old cashier can complete the purchase and accept the customer's money (thus, in effect, "selling" the alcohol to the customer). What is it about the act of scanning the price of the alcohol that is so troublesome?

I've only been able to come up with two explanations and one falls on its face almost immediately. The first explanation is that we don't want "underage" employees to sell alcohol (probably because it will "corrupt" them or lead to some other evil result). But, as I mentioned above, the underage cashier is able to complete the transaction and take the money. All the underage cashier is apparently prohibited from doing is scanning the bar code of the beer. This explanation also fails because the distinction between scanning the bar code, completing the transaction, and carrying the alcohol to a car is a perfect example of a distinction without meaning.

The only other explanation would be that we want older cashiers to handle the transactions so that they can properly check the age of the purchaser and do a better job of enforcing the applicable alcohol laws. Of course, the number of times that I've been carded when buying alcohol over the last, oh, 15 years, I can probably count on one hand. And again, I don't understand the distinction between 18-year olds and 19-year olds. They can both vote and can both die in Iraq, but we can trust one to check IDs and not the other?

Perhaps there is another explanation that I can't think of; I'd love to hear it. But absent some good explanation, these laws should be repealed.

Two other alcohol related laws are worth mentioning. First, of course, is the ban on alcohol sales on Sunday. Well, it isn't really a ban; after all, you can purchase alcohol at a bar or stadium or restaurant. Hoosiers for Beverage Choice is working on this issue (and on the cold beer in grocery store issue). I just want to add two thoughts on the subject. First, even before it was legal to sell alcohol in restaurants and bars on Sundays (I think that the law changed in the late '70s), it was legal to sell alcohol on Sundays at a facility with a paved race track of not less than 2 1/2 miles (of course, the only facility that fell into that exception was the Indianapolis Motor Speedway, home of the Indianapolis 500, which was run on Sunday). If always gotten a chuckle out of that one; apparently, even when Indiana was dry on Sundays, the legislature recognized the importance to the state of the Indianapolis 500 and did what was necessary to help.

More importantly, it seems obvious that Sunday was day chosen for a limited ban on alcohol sales for religious reasons. I guess that I our legislature felt that on Sunday Hoosiers should be in church (or at a sporting event or restaurant or bar) and not at a liquor store. But we are, in essence, limiting the rights of all Hoosiers to engage in a certain form of legal commerce and recreation, apparently in order not to offend the religious sensitivities of other Hoosiers. We don't prohibit the purchase of meat on Fridays during Lent and we don't prohibit the purchase of pork or other products prohibited by certain religious belief. So why do we elevate one particular sensitivity in order to appease a particular religious constituency? Blue laws like this one (or the ban on selling cars on Sundays) have no place in the 21st Century and should be repealed.

Finally, it has recently come to my attention that for some other arcane and idiotic reasons (having primarily to do with protections for alcohol wholesalers), some wineries and wine clubs are prohibited from shipping their wines to addresses in Indiana. One might ask the legislature -- elected to represent the people of Indiana -- to explain why they believe it appropriate to protect wholesalers at the expense of individual Hoosiers. Just curious.

As Indiana fights to attract jobs and economic investment, our legislature has to look carefully at laws that make Indiana a less attractive destination and/or which make us look like hicks still living in the 19th Century. Blue laws are at the top of that list.

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Friday, December 5, 2008

Things for Auto Industry to Thing About Before Asking for Our Money

Now it is the auto industry's turn to ask Congress for a bailout (or loan). In all honesty, I really haven't given enough thought to whether I think this is a good idea or a bad idea (I'm leaning toward good but I could be swayed) and I'll readily admit that I do not have anywhere near enough information to make a truly informed decision on the issue. Having said that, there are a few things that I think that the auto industry ought to think about as part of their survival plans.

Let me preface this discussion by asking two semi-rhetorical questions: 1) Do you enjoy the process of buying a car? 2) When I say "car salesman" what words come to mind?

Retailers like Best Buy have made shopping for technology fun. Borders and Barnes & Noble make book shopping a pleasant experience (although I do miss some of the quality independent bookstores). And most retailers of other products have endeavored to make their own shopping experience a happy one. But not the auto industry. I don't know about you, but I absolutely dread the process of shopping for a new car, so much so, in fact, that I will put it off as long as possible. If the auto industry really wants to sell more cars -- and let's face it, at the end of the day, that is really what the industry is all about -- then they have to find a way to get people like me excited about the actual process of shopping for and buying the car. It should be pleasant, not painful. (And note that there is a distinction between excitement for the car itself and excitement in the process of shopping for the car.)

When I buy a widget at Target, I know that I'm paying the same price as everyone else. Sure, the item may have been on sale last week or might go on sale next week, but for the most part, everyone buying that widget that week will have paid the same price for it. My widget will have come with the same warranty as your widget (unless I paid for some kind of "protection plan"). In a lot of cases, I can even return my widget if it doesn't live up to its advertised qualities. I can even make a rough guess about what the retailer paid for the widget before selling it to me.

Of course, none of that holds true when buying a car. I have no idea whether the price that I'm paying bears any resemblance to the price that you're paying. Perhaps I'm a better negotiator than you are; then again, maybe I'm a miserable negotiator. In either event, neither one of us really knows if we are paying the "best" price for that car; instead, we are at the mercy of our respective "skills" in negotiating matched against the skills of the particular salesman that happens to shake our hands when we first walk onto the car lot. I don't begrudge the salesman and dealer making a living from selling the cars, but I don't ever want to feel as if I might have been cheated or taken advantage of and that, all too often, is precisely how I feel after buying a new car. I may have gotten the absolutely best possible deal and yet I still feel is if I've been played and worry that someone got a better deal.

Factor on to that the fact that certain people are treated differently by the salesperson (I seem to recall readings studies about how women and certain minorities are treated at car dealerships) and the problem is magnified. I know that my wife would not be amused to learn that she paid more for the widget at Target simply because the salesperson knew that she didn't know as much about the product and could, therefore, be "taken for a ride".

Besides a house, a car is just about the largest purchase that most people will ever make. So why should we be put in a position where we feel bad about that purchase? And if we do feel bad about that purchase (even without real reason), why would we look forward to our next purchase?

Maybe there is something that I fundamentally don't understand about the auto industry. But I don't see why the car can't simply have a price tag on it that tells me the price that I and everyone else must pay for that car. And I don't see why that price tag has to have "extras" that are nothing more than thin disguises for the dealer to steal a few more dollars from my wallet. I guess what I'm saying is that I don't want to negotiate the price of my car and I don't want to worry that someone else was able to negotiate a better deal. I want to decide which car I want, be able to compare one to another on the basis of features and the known price, and then make my decision. I don't want to have to play games with the dealers. The mere fact that there are so many services available (CARFAX and Consumer Reports, for example) who offer services to help a consumer try to learn the "right" price to pay for a car illustrates the problem.

And speaking of games, does anybody else go absolutely berserk when the salesman says, "Gee, let me go talk to my sales manager," before disappearing for 20 minutes? What's that all about? And how many times have you watched the salesman and sales manager stand around and laugh during that time. Are they laughing at a good joke or are they laughing at us? I'm sorry, but that just isn't the way to make me feel good about the process of shopping for and buying a car.

One more quick point on the subject. When you take your car in for warranty work, do you trust that you are getting the best service work? And when you ask a question of the service department, do you trust that you are getting the correct answer? If you are anything like me, I suspect that you did not answer either of the foregoing questions with an unqualified "yes" and that, of course, is demonstrative of yet another problem in the auto industry. A car is a complicated machine and most of us are at the mercy of the mechanic to tell us what is wrong and how to fix it. The fact that many people don't trust what the mechanic tells them but are, essentially, powerless to do anything but act on the basis of that mistrusted information is yet further illustration of the problem and of the disconnect between the auto manufacturers and the car-buying public.

So, by all means, the car manufacturers should rethink their approaches to automotive design and fuel efficiency and employee benefits and a whole host of other corporate business decisions. But I think that they will be doing themselves an enormous disservice if they don't use their bailout request as a chance to rethink their relationship with their intended customers to try to find a way to make us want to buy cars.

And why can't I buy a car on Sunday in Indiana?

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