CHECK IT OUT 1994-06-27

John Karolefski

There's no question that widespread grocery shopping via interactive television would shake up the traditional food business.

So the real questions are: Is this scenario likely to happen? If so, when? Should manufacturers and retailers get involved? If so, how and when?

This subject was one of the more provocative ones presented last week at the annual executives conference of the Grocery Manufacturers of America. (See story on Page 11.) Geraldine Laybourne, president of the cable channel Nickelodeon, included interactive shopping in her talk on reaching the consumer via the information superhighway.

It's not surprising that Laybourne said that home shopping for groceries makes a lot of sense. Cable is her business. But several prominent food industry executives agree.

"Marketers should understand that a large number of supermarkets won't exist by the year 2000. So they will have to learn to market their products electronically," said Carlene Thissen, president of Retail Systems Consulting.

The country's first test of supermarket and pharmacy shopping via interactive television is set to take place later this year in Florida. Time Warner Cable is debuting its Full Service Network in Orlando through a company called ShopperVision Express.

Laybourne firmly believes that retailers and manufacturers should get involved with this new form of nonstore retailing.

"Otherwise you'll be in the same situation you are in right now with endless negotiations for shelf space," she says.

Two retailers, Winn-Dixie Stores and Eckerd Drug, will follow that advice and take the electronic plunge. They will supply the products that cable subscribers in the Orlando test order from the comfort of their homes.

Barry Goldman, president of ShopperVision Express, told Brand Marketing that manufacturers will be able to promote and advertise their brands in much the same way they do in real stores today. For example, instant coupons, shelf talkers and promotion packs could be presented on the screen. There could be signage and audio messages.

In the Orlando test, the company will load the program with digitized versions of 20,000 grocery products for Winn-Dixie shoppers and 7,500 items for Eckerd shoppers. For more products, manufacturers will have to pay for each stockkeeping unit to be added to a national data base.

Yes, national. For openers, the company already has plans to be in three to five more markets in 1995. Also, there are plans to expand to mass merchants, pet and office supply companies.

Obviously, if such a shopping service succeeds, brand marketing through the retail trades takes on a new meaning. It would make sense for retailers to get involved early to get on the learning curve and beat out other retailers -- maybe even nontraditional ones -- to be the supplier of products to shoppers.

Manufacturers surely would want to have all their key SKUs in the national data base. It would also make sense to market brands "in-store" on the TV screen because it makes sense in real stores.

All of these strategies make sense in a virtual reality kind of way. In real reality, however, this electronic service will have to prove itself before we start boarding up the stores.