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Could 2011 be different?

BY Michael Johnsen

NEW YORK — Within the next three months, a gallon of gas is expected to exceed $4.11, which previously marked the highest historical U.S. retail price set in July 2008. Prior to that, the highest that gas prices had ever been was $3.46 in March 1981. 


But experts believe the Summer Gas Crisis of 2011 will look a lot different than the Summer Gas Crisis of 2008. For one thing, retailers were much more receptive to supplier price increases in 2008 than they are today, said Todd Hale, SVP consumer shopper insights for the Nielsen Group. “[But there have been] a lot of efforts made by retailers over the last couple [of] years during this recession to cut costs [and] lower prices to make them look more value-oriented to their shoppers. It’s a little difficult for them to go back on that.” That suggests higher prices will be passed along almost wholesale to the consumer, a factor that further could curtail spending, as wages remain relatively flat. 


There’s also the impact of the recession to consider. Households generating more than $100,000 in annual income are faring much better today than they were in 2008. “The gas situation in 2008 carried further just because of what happened to our economy — people who had money stopped making trips,” Hale said. “Now we’ve got people who are feeling a lot more comfortable and confident about the economy.” 


As many as 45% of households earning $100,000 or more said their confidence in the economy has improved over the past six months, compared with 24% among those earning less than $100,000, according to a recent Deloitte survey. 


On the plus side, consumers may be better prepared to weather short-term price fluctuations at the pump today than they were in 2008. “Their short-term consumer debt has fallen,” said Gerald Hanweck, professor of finance at the George Mason University School of Management. “Consumers, in terms of their unsecured debt, are in much better shape than they were in 2008.” 


However, secured debt, such as mortgages, still represents an impediment to consumer spending, so extended gas price increases would have a detrimental effect. Should higher gas price increases extend beyond the summer, that could have a major impact on consumer spending heading into the holidays, Hanweck said. 


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Walgreens getting a charge out of electric fill-up

BY Michael Johnsen

DEERFIELD, Ill. — As the nation braces for higher gas prices this summer, Walgreens is exploring alternatives that may have longer-term potential and could serve as a differentiator among green consumers. As of April, Walgreens had announced three markets in which it had opened electric charging stations in its store parking lots. 


Unlike gas stations where consumers can simply pump and go, charging stations can take anywhere from 10 minutes to a half hour, which creates more time to capture more purchases. 


Working with 350Green in the Chicago market, Walgreens plans to install charging stations at about 30 area stores beginning this summer. In the Dallas and Houston markets, Walgreens is working with NRG Energy to install high-powered rapid charging eVgo Freedom Stations at 18 locations across the Dallas/Fort Worth Metroplex and 18 locations in Houston. By the end of 2012, NRG plans to install a total of approximately 70 charging stations in the Dallas/Fort Worth Metroplex and another 50 in the Houston area. Additionally, NRG plans to electrify the Interstate 45 corridor that connects the two cities.

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NewsBytes on CVS and Rite Aid’s latest promotions, Katz Group’s latest hire, GSK’s plans to divest OTC brands, and more

BY DSN STAFF

WOONSOCKET, R.I. — CVS Caremark has named Helena Foulkes EVP and chief healthcare strategy and marketing officer. In the newly created role, Foulkes will bring together the company’s capabilities in enterprise branding, communications, community relations, charitable giving, healthcare-reform strategy, government relations and marketing into one integrated organization in an effort to deliver even better business results and stronger partnerships.


 

CAMP HILL, Pa. — Rite Aid in April named Tony Montini EVP merchandising. Previously, Montini had served as SVP category management.


As EVP merchandising, Montini, who began working for Rite Aid in February 2010, will oversee field merchandising and new store format development in addition to his current category management responsibilities. He will continue reporting to COO Ken Martindale. Montini’s new responsibilities include the Wellness stores, Value + stores and co-branded Save-A-Lot/Rite Aid stores.


In addition, SVP business development Bryan Shirtliff has been promoted to the new position of SVP merchandising. Shirtliff will report to Montini and will continue to be responsible for store segmentation initiatives and front-end merchandising.


 

TORONTO — Retail pharmacy network Katz Group Canada has hired Frank Scorpiniti as COO. With more than 20 years of retail pharmacy experience, Scorpiniti previously was SVP pharmacy operations at Duane Reade. Prior to Duane Reade, he held positions of increasing responsibility at Longs Drug Stores.


 

BENTONVILLE, Ark. — Dijuana Lewis was named SVP healthcare solutions at Walmart. She will report to John Agwunobi, president of Walmart’s health-and-wellness business unit. Lewis most recently served as president and CEO of health benefits company Wellpoint’s comprehensive health solutions business unit, where she spent 16 years. She is expected to oversee development of products and services in collaboration with a third-party payer in the healthcare industry.


 

LONDON — GlaxoSmithKline last month identified several noncore OTC brands it intends to divest in order to focus its efforts around a portfolio of fast-growing consumer health brands and emerging markets. The company plans to complete all transactions by the end of the year.


The products include analgesics Solpadeine, BC and Goody’s; Abtei vitamin and supplement; feminine hygiene treatment Lactacyd; and Alli for weight management. The products had sales in 2010 of approximately $816.9 million.


Following the divestment, GSK Consumer Healthcare will focus on three priority categories: oral health, wellness/OTC and nutrition.

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