STORES SEE PREMIUM QUALITY VARYING

STEPHEN DOWDELL

CHICAGO -- The growth of premium store brands is leading supermarket chains into muddy waters in defining quality, said the head of quality assurance at Kroger Co., Cincinnati.

"By virtue of their success, premium programs represent a viable market which should be perused. Success, however, spurs growth and what starts as a small line of truly unique products, worthy of premium distinction, many times grows to include items of arguable virtue," said Keith Neer, director of corporate technology for Kroger, speaking at a conference on private label held here by International Business Communications.

The Kroger official is not alone in asking where the quality of premium private label is headed.

His peers in the quality assurance field agree that industry measurements get fuzzy at most companies, once their programs move beyond traditional "first-quality" private label toward the premium end of the spectrum.

Neer, also president of the Quality Assurance Association, a group of 120 quality assurance specialists working in the private- label arena, surveyed his members about how their companies define and measure quality. The consensus was "clarity is lost" when the quality of premium store brands was the subject.

"You hear more nebulous discussions about what quality really is and 'giving the customer what she wants.' A professional guess suggests that 'first' quality comes closer to 'that which everyone knows,' while variations on either side of this 'known' create problems," Neer said.

However, the lure of the premium store brands market is hard to resist. Neer's own chain is moving into this market with the Kroger Select brand, albeit at a snail's pace, with a portfolio of products that Neer said "you could count on one hand." Until stepping into the premium parade a few months ago, Kroger had been one of the few holdouts among leading supermarket chains.

Questioned about how Kroger now defines the level of quality offered by this new Select tier, Neer said, "The products must be arguably better, as measured by consumers." He conceded, however, "It is a tough nut to crack. In the case of a product like white bread, what do you do? In those cases where we do have Kroger Select, the decision was made based on consumer tests."

He said for every Kroger Select item, the chain has an existing first-quality label equivalent, adding, "That is not a statement of policy; it is just where we are right now."

Kroger's consumer-based criteria seem to be acceptable to other quality assurance technicians who are searching for a standard for premium programs.

Judging by his survey, Neer said, "Any agreement on what is meant by value seems to center on the philosophy of providing a product which, in the consumer's eye, achieves the level of satisfaction suggested through packaging and advertising."

The implication is that "as consumers move from the 'norm' (first quality), they require more information to fulfill their product expectations.

"One thing everyone seems to agree upon is that creating an image through high-quality packaging and/or advertising has become the accepted method of communicating 'premium' for the customer. This is different from the 'norm,' where people have experience to draw upon as they articulate expectations," he said.

Neer said he and his colleagues expected chains' premium programs would quickly go the way of generics if they were allowed to grow without a reevaluation of how they define quality.

He proposed at least one "common thread" on which to deliver the message of premium quality, no matter how it is defined: consistency.

"For premium quality to be defined in real terms, performance must be part of the equation. Variance from one product to another is precisely one of the issues that killed generics. One thing for sure, when you talk to technical folks, is that the alarm is being sounded as it relates to the great potential in premium programs and the real possibility of failure. Without performance, you stand to have one sale only."