PREFERRED MANUFACTURERS HAVE HUMAN TOUCH

BARBARA MURRAY

NEW YORK -- Although the Web is not an effective direct channel for consumer packaged goods manufacturers to sell to consumers, CPGs can use e-mail to provide a human relationship in a world that becomes more uncertain day by day.

"We think manufacturers can use e-mail to give consumers what they want -- and also to maintain good relationships with grocery retailers -- by a co-marketing, e-mail campaign such as those used by H-E-B and Winn-Dixie," said Christine Overby, an analyst with Forrester Research, Cambridge, Mass.

However, Kraft Foods, Northfield, Ill., has had success in selling novel or hard-to-find products, like exotic flavors of Kool-Aid and jalapeno mac-and-cheese, to a select group of consumers over the Internet, Overby said.

Views were expressed May 23 by three panelists on a CPG-oriented teleconference, which cited several surveys, primarily one done for Cap Gemini Ernst & Young here earlier this year based on 7,000 consumers, and part of a larger report that included some other retail background, including some grocers and some discounters.

Frederick Crawford, executive vice president, Cap Gemini Ernst & Young, pointed to a "chasm in trust" based on the survey, in which only 16% of respondents believe manufacturers' claims are generally true. Another trend coming out of that research is that low price is less important to consumers than consistent and honest prices, pinpointed by 87% of those in the Cap Gemini survey. "We also find that although retailers have had the most influence over the consumer, consumers do expect to see human values reflected in their interactions with manufacturers," Crawford said.

He said retailers are losing their distinction as the chief point of interaction between consumers and brands, based on survey findings that consumers desire an open dialogue with brand manufacturers. At the same time, manufacturers are losing control over which channel their products are sold in, Crawford said, citing the example of Procter & Gamble's reformulation of the Dawn dishwashing detergent to fit into the dollar-store format with a smaller package.

Brands have reached a critical juncture, said Mark Baum, executive vice president of the Washington-based Grocery Manufacturers of America and head of the Association of Sales & Marketing Companies, in that they must innovate, yet provide the familiar comfort of roots.

"The power of brands is becoming even stronger in that a brand represents certainty in an uncertain world. It is more global, and there are fewer roots and ties to the community, all punctuated by the events of Sept. 11," he said.

Almost 40% of consumers use a particular product simply because their family had used it for a long time, he said.