STOP & SHOP GOING ON-LINE WITH HEALTH INFORMATION

STEPHANIE LOUGHRAN

QUINCY, Mass. -- Stop & Shop will be the first grocery chain in the country to offer its loyalty card members a unique new Web-based service from SmartMouth Technologies, Watertown, Mass., that provides shoppers with nutritional information and shopping history analysis of their food purchases.

The program is viewed as an important component to expanding the chain's whole-health initiative, say chain executives.

The service is slated to launch in mid-January and eventually will be available to a "substantial number" of over 260 Stop & Shop stores, according to officials.

The SmartMouth technology is powered by a massive food-item database that includes approximately 30,000 items of national brands, fresh and packaged goods, as well as private label. Accessed through the retailer's or SmartMouth's Web site, Stop & Shop loyalty card members will enter their card numbers to view an instant nutritional analysis of their grocery purchases that includes all the ingredients. The program will allow customers to select personal health goals such as foods lower in fat, sodium or sugar. The software will then suggest healthier food alternatives.

Calling it a "great service and opportunity" for Stop & Shop and its customers, Ed Porter, the chain's director of marketing, told SN last week that the service is a new way for Stop & Shop "to differentiate from our competitors."

Randy Fine, chairman and chief executive officer for SmartMouth, said, "It allows the retailer to meet the whole-health needs of their consumers, as well as give an exciting new benefit to their frequent shopper card."

According to Fine, the program will be "the foundation of Stop & Shop's healthy living strategy," the first component to a much larger whole-health program that will be rolled out in the next several months.

"This is one of the legs on the stool," confirmed Porter. The program's success will depend upon its rollout to other Ahold USA divisions, said Fine. Stop & Shop is owned by parent-company Ahold, Zaadam, Netherlands.

Neither SmartMouth nor Stop & Shop would cite specifics of a multi-year service contract. Fine only said retailers will be charged a per-customer subscription fee. "[Retailers] are only paying for the service for those consumers who actually take advantage of it," he said. "The price is insignificant compared to the value it creates."

Grocery partners like Stop & Shop that are among the first to sign up for the service avoid an implementation fee. The fee covers the work involved in customizing the retailer's data bank of food products. SmartMouth takes three digital photographs of all food products sold in the store. The images display the food label, ingredients and UPC code. This information is then entered into the retailer's data bank.

SmartMouth is targeting traditional grocery chains and offering its program on an exclusive basis in the chain's marketing area. The program is designed to accomplish several goals for the retailer -- attract new shoppers, enhance customer loyalty and increase sales on higher margin items. The program is expected to attract usage from "health sensitive" shoppers rather than those who are price sensitive, said Fine.

"For the first time, the consumer can get feedback on what they've bought in a store, and they can use that feedback to buy healthier [often higher margin] products next time," Fine explained. "This gives non-Stop & Shop customers a reason to shop there."

He also said it gives retailers a novel way to retain customers. Through the program, "these consumers will build a relationship with this product, grow to trust it and rely on it. Through usage, it gives the customers a reason not to run to a competing retailer." Otherwise, shoppers will lose the continuity and record of their food purchases.

The intent, said Porter, is "to give customers useful information so they can make better [purchasing] decisions."

Stop & Shop will support the SmartMouth launch with an extensive radio campaign, in-store signage, circulars and demos, as well as advertising the service on Stop & Shop shopping bags. "Stop & Shop is making a big effort to get the word out to customers," said Fine.

Another advantage of the program is that it includes private label. "A lot of health-conscious shoppers don't buy store brands because they view them as unhealthy, and that is often not the case," said Fine. He added that store brands are equally healthy or even healthier than some of the branded products, and the program "will encourage people to take a look at private-label products."

SmartMouth previewed its on-line service at the Whole Health Marketing & Retail Strategies Conference, Broomfield, Colo., in November, and it drew a wide range of curiosity among retailers.

Ralph Prescott, category manager at Prescott's Supermarkets, West Bend, Wis., said, "We're very interested to see how initial rollouts go." He added, "I really hope it can be [a good addition]."

Russell Haines, natural foods specialist at Copps Corp., Stevens Point, Wis., said the program "is on the table for discussion, but I don't know how serious we are about it."

"For some, it would be a viable option," said Haines. "For smaller operations, it may be too expensive -- it depends on your market."

How SmartMouth Works

Here's what loyalty card customers can expect when they log on to Stop & Shops' Web site (www.stopandshop.com) and are linked to SmartMouth.

Step 1: Stop & Shop customers go directly to www.smartmouth.com or click on the SmartMouth link from the Stop & Shop home page.

Step 2: Users enter their 10-digit Stop & Shop card number.

Step 3: First-time visitors set up a password to restrict unauthorized access.

Step 4: Users select their personal nutrition goals (e.g. reduce fat, increase calcium, reduce calories), then click GO.

Step 5: Customers get an instant nutritional analysis of their Stop & Shop card purchases. The site assigns a SmartScore to each purchase and flags foods where there are better nutritional choices.

Step 6: Users can click on any food for more detailed nutritional facts.

Step 7: Clicking on any flagged food creates a pop-up box with a list of healthier substitutes -- choices that are more in line with the users' nutritional goals. (For example, find a frozen pizza with less fat, vegetable soup with less sodium, or bread with more fiber.)

Step 8: Consumers can browse the store by department and add any item to their printable shopping list by clicking on the pencil icon next to it.

Step 9: Visitors have access to a trove of healthy meal ideas, including quick dinners, kids' lunches, healthy snacks and breakfast on the go.

Step 10: Customers can get the latest nutritional news -- information on dieting, disease management, details on various nutrients. Virtual dietitians lead tours through sections of the supermarket, provide tips on food preparation, and answer users' questions on nutrition and healthy eating. Content, much of which is developed by SmartMouth's in-house team of Registered Dietitians, is continually updated and reviewed and approved by Tufts University School of Nutrition Science and Policy.