CONSUMER CONSCIOUS

LISA A. TIBBITTS

At a time when shopper loyalty seems to be at an all-time low, consumer affairs professionals are finding their roles more critical to supermarket strategies.

As supermarket chains battle an increasing number of alternative format units for share of stomach, these executives are serving as "early warning systems" to help management meet the needs of customers.

Professionals from 10 companies discussed some of their greatest challenges and provided some solutions in an SN survey. While their duties vary, they are now concerned with getting a handle on the increasingly educated and demanding consumer.

"The sheer scope of the issues that consumers are now concerned about is the greatest challenge," said Joanie Taylor, director of consumer affairs for Schnuck Markets, St. Louis. "It requires you to stay on top of scores of issues instead of narrowly focusing on one or two." Among the major issues faced by these executives are:

Differentiating supermarkets from other formats in the eyes of shoppers.

Meeting consumers' special needs in areas such as food offerings, nutrition education and packaging.

Educating consumers about food safety and biotechnology.

Making the shopping experience faster and more convenient.

As the demographics of their markets change or as retailers enter new markets, these executives are increasingly developing programs to serve different ethnic groups. Moreover, as the supermarket industry embraces technological innovations, many consumer affairs executives have been placed in charge of their companies' frequent shopper programs. Often, this means they are also responsible for consumer education.

When asked how they quantified their value to their companies, the executives said the benefits of their efforts cannot be easily identified in bottom-line results.

"It's very easy to put a dollar quantity on how much money [other] departments make for a company," said Anne Bridges, director of consumer affairs for Carr Gottstein Foods, Anchorage, Alaska. "You know how much it's costing you in labor and in the goods that you sell in the store, so you're able to quantify the profit you make for that company. In consumer affairs, it's impossible to say I brought in this much money to the company."

But at least one company -- Spartan Stores, Grand Rapids, Mich. -- has developed a way to determine how the department contributes to sales. The company tracks the ingredients sold through its warehouse to its members when recipe cards are merchandised in-store. The card program was developed by the consumer affairs department.

"We did a test and we did show that by having the recipe cards, sales from the stores increased movement out of the warehouse for the brand names highlighted there by 13% on average," said Shari Steinbach, consumer affairs and public relations supervisor. "And if they were brand new products and we had recipe cards in the stores, we saw a 35% increase in movement compared to like stores that did not have the recipe cards in them."

Following are comments from the executives polled by SN, who discussed some major issues they face and how they are handling them:

Margaret McEwan

VP, consumer services and quality assurance

Shaw's Supermarkets

East Bridgewater, Mass.

In my view, [my biggest challenge is] providing services to customers that contribute to differentiating supermarkets from the other alternative formats such as club stores and the take-home food providers such as Boston Market.

What a lot of companies are doing is responding with more fresh foods and foods that are ready for consumption. We are expanding on those concepts, providing that one-stop shopping solution. In addition to the meal, we're also offering services like dry cleaning and full-service banking.

We have [responsibility for] quality assurance for Shaw's private-label program. Because we work so closely with customers and the issues they raise, we can adapt the ideas that they offer to us in the way we might design the packaging. For example, how difficult is it for a person with arthritis to open a Ziploc bag?

Just this spring, we did the test pilot for an FMI program. It's called To Your Health. We did that one in partnership with an elder services group and it reached about 20 different communities.

We had graduate-level students provide instruction for seniors in meal sites and introduce them to some pamphlets that were specifically targeted to active adults who are looking to combine good eating and activity. We were very pleased with the outcome of that and we hope to expand on that.

Don Vallaincourt

VP, corporate consumer affairs

Grand Union Co.

Wayne, N.J.

One of the biggest challenges is further education of the consumer. In a nutshell, the thrust is to let people know about the new foods we're offering and educate them in what to do to prepare them.

We feature new products in our Sunday roto section. We have recipe cards that are available at point-of-purchase. We highlight new products. In the produce section, for example, we make sure our people are thoroughly educated about the products. We have booklets with recipes and they also contain preparation tips.

I handle the customer service department so we analyze all the comments we receive from the customers and we get on the average 15,000 comments a year. Of the 15,000 comments we get, about 20% are compliments.

We prepare a report for management of comments received by telephone and letter broken down [by subject] and various trends, so we become a distant early warning system. It reports on trends that occur and that report goes to all members of Grand Union management.

Ruth French

consumer relations manager

Save Mart Supermarkets

Modesto, Calif.

Industrywide, our greatest challenge is all the other players trying to get a share of that different plate. How do we meet these needs for quick foods, fast foods, healthy foods and not [have shoppers] wait in line if you can buy food on every street on all four corners?

In terms of consumers' concerns, what we're hearing more of is food safety issues. The issue has gone beyond food safety at the supermarket. People are beginning to see it as a home safety issue also.

We have been getting many more phone calls on our toll-free line. We get 600 to 700 calls a month. There are three of us and an answering machine.

People are interested in time. We hear that both from food questions and cooking questions but also from a service standpoint. We can't stand in line at the supermarket anymore. We want to be able to get it on the table quickly. We've gone from cooking meals to assembling meals and that's a challenge to the supermarket industry too.

Whenever we do recipes and recipe brochures, we always have an eye to the time that it takes to prepare them.

Jennifer Stenger

customer relations manager

King Kullen Grocery Co.

Westbury, N.Y.

Since I've taken over the position [in July], we're now focusing a lot on the different local chambers, doing a lot of public relations work.

People's perception of the company is very uplifted. They enjoy that we're getting involved in the community, being part of the festivals, listening to community members through the chambers.

We set up a table at a festival in Belmar, raffling off gift certificates, fruit baskets. I acquired about 1,200 names for our mailing list. We will send follow-up letters to the consumers. We have a We Want to Hear From You form where they can send replies on what they think of King Kullen.

Joanie Taylor

director, consumer affairs

Schnuck Markets

St. Louis

The sheer scope of the issues that consumers are now concerned about is the greatest challenge. It requires you to stay on top of scores of issues instead of narrowly focusing on one or two.

The biggest issue [that consumers are concerned with] is biotech -- food products that are biogenetically engineered. Going back nine years [since I started here], most consumers were concerned about the condition of their products in terms of how they were bagged. Now it's [a concern with] how they were grown.

I depend a lot on partnerships, whether it's the manufacturers who want to get information into our hands, the Food Marketing Institute, even the government -- the USDA, the FDA.

I'm partnering with a local university that is trying to educate African-American women on healthy shopping and eating. The school is Washington University Schools of Social Work and Medicine in St. Louis. The program is the Eat Well, Live Well Nutrition Program. It uses empowerment activities to increase healthy eating among African-American women.

Through our acquisition [of National Tea Co. from Loblaw Cos., Toronto] we're getting into new urban neighborhoods, so we're servicing a broader spectrum of customers. The women's program is a direct result of our going into urban communities.

Anne Bridges

director, consumer affairs

Carr Gottstein Foods

Anchorage, Alaska

Because of education -- which is wonderful -- customers are much more knowledgeable today than they used to be and this is excellent because you can give them even more information than they can obtain from articles and from packages.

What this produces, though, is that customers today are more demanding than they were 20 years ago or 40 years ago. And it's much more challenging and of course it's much more stimulating for someone in the area than say 20 or 40 years ago.

The biggest challenge that faces all of us is to make consumer affairs part of the bottom line of the company and, related to that, ensuring that the top executives don't only see consumer affairs on the loss side of the profit and loss sheets but see it as an integral part of making a profit.

It's very easy to put a dollar quantity on how much money [other] departments make for a company. You know how much it's costing you in labor and in the goods that you sell in the store, so you're able to quantify the profit you make for that company.

In consumer affairs, it's impossible to say "I brought in this much money to the company."

Shari Steinbach

consumer affairs and public relations supervisor

Spartan Stores

Grand Rapids, Mich.

Consumer education [is one of the greatest challenges I am facing]. Consumers hear so much misinformation that I feel it's a real challenge to get them to trust us on the information we provide, whether it be nutrition, food safety issues or what have you.

Another challenge is dealing with the diversity issues. Spartan services 475 independently owned grocery stores and there's one of me to work with all those stores. I'll help them start up a program, then find them a local source to go into the store.

I do have a program that's in 110 stores that is a consumer recipe center and that does tend to reach all consumers. Right now we are looking at expanding the recipe program that we currently do. They can now pick up recipe cards and they'll eventually be able to pick up a weekly menu plan.

We get rid of 25,000 of each recipe card each month.

We did a test and we did show that by having the recipe cards, sales from the stores increased movement out of the warehouse for the brand names highlighted there by 13% on average. And if they were brand new products and we had recipe cards in the stores, we saw a 35% increase in movement compared to like stores that did not have the recipe cards in them.

Michele Maselli

communications manager

Mayfair Super Markets

Elizabeth, N.J.

I think one of the difficulties [I deal with today] is that customers are more demanding. They expect more for their money -- more service. And they are very willing to switch supermarkets at the drop of a hat. It's very difficult to obtain customer loyalty.

We try to get customer loyalty by being such a customer service-focused company. That's our forte -- service.

A big issue is privacy. Preferred shopper programs collect data and shoppers don't like that. You have to assure customers that you're offering them a service and a privilege and with that there are certain requirements.

Brenda Gerland

director, community affairs

Fiesta Mart

Houston

Customer relations are under my umbrella and unfortunately that comes out to customer complaints.

There is a lady who handles customer complaints here within our office. I think most of them are just people who want to talk. The lady who handles complaints is a very, very patient lady who just listens to the customers.

That's our biggest issue: how we handle our customers. Our consumers are concerned about being treated fairly, about convenience, clean stores and fair prices.