February 5, 2009
Grocers Use Cards to Get Recall Word Out
Retailers,
including Costco, Kroger and Sam’s Club, have been using membership and
loyalty card information as a means to help alert customers to product
recalls related to the recent salmonella outbreak.
Others, for
a variety of reasons, have not used card data to alert consumers. Giant
Eagle, for example, is not making calls or alerting shoppers outside of
its stores. Mike Duffey, a spokesperson for Giant
Eagle, told The Columbus Dispatch, that the sheer size of the peanut-related
recall posed
"operational hurdles" the chain believed could be handled better
through in-store communications.
Safeway is
another company that did not use its card data to track down shoppers who
purchased recalled product. Kris Staaf,
a spokesperson for the company, told The Denver Post, "It’s
not something we really looked at, but we’re going to give it a hard look
now."
One of the
problems with loyalty card data, said Ms. Staaf, is information is not always accurate because card
users "fill
out the form and provide an e-mail or a phone, and sometimes that information
is bogus."
Earlier in
the week, The Center for Science in the Public Interest (CSPI), called
on food retailers to mine card data to more effectively recall products.
"Supermarkets
enjoy using purchasing data for marketing purposes," said Sarah Klein,
an attorney for CSPI, in a statement. "We’re calling on supermarkets
to also use that information to protect their customers’ health by alerting
them to identify and return tainted foods.
"It
would be outrageous if some of the deaths in this latest outbreak could
have been prevented had a supermarket just used the phone numbers and addresses
in its database to notify its customers," she added.
Kroger began
printing a list of products that might have been purchased during a recall
period based on a shopper’s loyalty card information.
"One
of the great benefits of the Kroger Plus card is that it allows us to help
customers out and keep them safe," said Beth Wilkin, a Kroger spokesperson. "A
lot of folks have told us they forgot they purchased the product and that
it was in the back of their pantry somewhere, but this brought it to their
attention and they went home to clear out the products."
Discussion Questions:
Is there an opportunity to use card data to communicate in areas other
than traditional marketing, such as in the case of recalls? How would
more communication with customers affect store loyalty?
BrainTrust
Recent Discussions
Discussion Questions
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Recalls are bad news and I don’t think retailers should be in the bad news business. Let the TV networks and newspapers do that.
US food retailers have not taken full advantage of their loyalty cards, whether for marketing or for consumer alerts. Most retailers are sitting on mounds of data, with little idea how to use it other than to capture contact information and send out a quarterly advertising circular. This needs to change.
In an era of two-way communication and permission marketing, this data could be the key to opening a mutually beneficial dialogue with consumers, both for special offers and for potentially life-saving information.
Communicating a recall is still customer communication and must be looked at as marketing. Because of membership rules, warehouse clubs have always had customer info on file and have been communicating recalls and quality control issues for a very long time. Using loyalty data to send out recall notices is a valuable gesture to your customer. This goes back to building the customer’s confidence in your brand. The ultimate message is ‘we care about you’.
A recent issue at a club chain was in regard to the recent salmonella outbreak that affected some of their product. A letter went out to all members outlining the problem and more importantly, what to do about it (return procedures, health resources etc). Sharing information like that with your customer will go a along way in building trust and the relationship retailers need with their customer.
This conversation came up yesterday with a group of retail folks; some thought it was brilliant and others found it a bit creepy. I personally think it’s proactive, responsible communications that adds enormous value to the loyalty relationship.
A current-day consumer responds: “Talk to me,” my good retailer. “Inform me early about product recalls but also regularly communicate your special product and service offerings that you have for loyal card users such as am I. Cultivate me, communicate with me, and you’ll capture me.”
This episode puts a “point” on the point–retailers should be using card data to benefit consumers–not just to market to them. That is how retailers can build a relationship with shoppers that engenders loyalty, rather than alienating me by refusing to give the the “card price” when I forget the stupid card.
There is a fundamental quid pro quo when it comes to customers opting in to a relationship with a merchant. Marketing communications, offers and loyalty programs are only part of the expectations that customers have.
Increasingly, customers who have opted in are expecting that the retailer knows them. Given that the most fundamental part of knowing them is tracking purchases, when companies don’t do anything with the data, whether for marketing purposes, returns/exchanges or product recalls, they simply fail to meet customers’ expectations.
The challenge, as has been discussed here recently (see Nikki Baird’s comments regarding technology and use of data for customers/business intelligence), is that it is not always easy for companies, including retailers, to get clean data and the associated insights embedded in those data.
The challenge (and opportunity) is that customers are smart and increasingly savvy when it comes to managing their privacy and relationships with companies. Companies that fail to leverage the data they have, and act more intelligently because of it, will lose those customer relationships.
Supermarket customers are “forced” to provide information in order to secure a loyalty card that allows them to access the sale price for most items. In some case this means that they give false information regarding their phone numbers and/or email. However, because some do does not mean that it should be assumed that there is no useful or accurate information that came be used.
I agree with the comments that say what is the potential liability and morality of not even trying when you have the data. As a former retailer, I would be terribly disappointed in my team if they had not automatically made the attempt to reach out to our card base immediately.
We recommend to our clients that they use their data base to contact customer for a variety of reasons. One of the benefits of doing so is validating that data that you have so when you really need to reach someone you know if the information you have is accurate or not.
Some smart lawyer someday is going to say “My client’s child died, and your store could have prevented it.”
The feedback from contacting consumers with phone calls is overwhelmingly positive, especially when it comes to recalls. A targeted, timely, and important message has real value to consumers. My company, SmartReply, has executed dozens of recalls in the last two weeks for a variety of grocery clients.
Each recall needs specific handling. With the recent calls we have successfully directed consumers to websites, a manufacturer’s call center, an independent toll free number, and to retail call centers. We notify consumers in less than 24 hours.
Grocery databases are very powerful, and tend to be chronically underleveraged. Recall services are quick to execute, inexpensive, and recognized as a valuable service by consumers.
It’s unimaginable that any merchant would choose to forgo this opportunity to help their customers. This is a chance to touch the customer in a way that has nothing to do with selling and buying, i.e., it’s a chance to prove that the customer means more than dollar signs, while providing info that’s helpful and healthful.
Every merchant should use their frequent shopper programs for this type of recall. And if such alerts are currently not part of the program, then the program should be revamped to offer shoppers the chance to opt-in for alerts via email or phone. And there are other ways to leverage frequent shopper programs. As is, the programs are often used to merely access a product discount. Adding recall alerts and lifestyle info (like recipes, cooking tips, exercise tips, etc.) adds value and creates a bond.
Rethinking frequent shopper programs is long overdue. And the current recession is a good time to do so, since such content can help keep the brand top of mind while adding lifestyle value.
As a parent of three small children and the holder of three grocery loyalty cards, I would be upset if I DIDN’T receive a call from a grocer if they knowingly had access to data that I purchased a food product that could make us ill or potentially kill us if consumed. That, to me, would be irresponsible and a huge liability lawsuit waiting to happen.
Being proactive is not only the right thing to do, it’s actually promotes loyalty and offers sort of an “insurance policy” against litigation.
Additionally, it’s not only the grocers that hold the onus of responsibility. The manufacturers also need to cooperate more comprehensively with their outlets to promote the dissemination, by all means possible (pre-recorded voice mail, call center, mail, TV, radio, etc) of the tainted product they distributed to the marketplace.
I strongly agree with the consensus opinion here about using loyalty data for recall notification: if it is not a legal obligation, then it is at the very least a moral one (to say nothing of the positive marketing value on your store’s brand).
The front page of today’s New York Times raises a related issue in the article “Fallout Widens as Buyers Shun Staple“; namely, what do you do about similar products that *aren’t* recalled? With peanut butter sales off nearly 25%, the thoughtful retailer would look for shoppers whose peanut-product buying habits have changed drastically since the recall, and would target each of them with an informational campaign addressing their fears. Combined with an aggressive campaign to notify people who may have bought tainted products, the message would have real credibility in reassuring spooked shoppers. So you get a win-win-win: protect the customers at risk, build credibility with everyone, and increase sales of products whose sales were hurt by association.
The challenge, of course, is that few retailers have the tools or the time to put this plan into action. My company hopes to change that, but I expect it will be years before this type of proactive recall notification is the rule rather than the exception.
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Recalls are bad news and I don’t think retailers should be in the bad news business. Let the TV networks and newspapers do that.
US food retailers have not taken full advantage of their loyalty cards, whether for marketing or for consumer alerts. Most retailers are sitting on mounds of data, with little idea how to use it other than to capture contact information and send out a quarterly advertising circular. This needs to change.
In an era of two-way communication and permission marketing, this data could be the key to opening a mutually beneficial dialogue with consumers, both for special offers and for potentially life-saving information.
Communicating a recall is still customer communication and must be looked at as marketing. Because of membership rules, warehouse clubs have always had customer info on file and have been communicating recalls and quality control issues for a very long time. Using loyalty data to send out recall notices is a valuable gesture to your customer. This goes back to building the customer’s confidence in your brand. The ultimate message is ‘we care about you’.
A recent issue at a club chain was in regard to the recent salmonella outbreak that affected some of their product. A letter went out to all members outlining the problem and more importantly, what to do about it (return procedures, health resources etc). Sharing information like that with your customer will go a along way in building trust and the relationship retailers need with their customer.
This conversation came up yesterday with a group of retail folks; some thought it was brilliant and others found it a bit creepy. I personally think it’s proactive, responsible communications that adds enormous value to the loyalty relationship.
A current-day consumer responds: “Talk to me,” my good retailer. “Inform me early about product recalls but also regularly communicate your special product and service offerings that you have for loyal card users such as am I. Cultivate me, communicate with me, and you’ll capture me.”
This episode puts a “point” on the point–retailers should be using card data to benefit consumers–not just to market to them. That is how retailers can build a relationship with shoppers that engenders loyalty, rather than alienating me by refusing to give the the “card price” when I forget the stupid card.
There is a fundamental quid pro quo when it comes to customers opting in to a relationship with a merchant. Marketing communications, offers and loyalty programs are only part of the expectations that customers have.
Increasingly, customers who have opted in are expecting that the retailer knows them. Given that the most fundamental part of knowing them is tracking purchases, when companies don’t do anything with the data, whether for marketing purposes, returns/exchanges or product recalls, they simply fail to meet customers’ expectations.
The challenge, as has been discussed here recently (see Nikki Baird’s comments regarding technology and use of data for customers/business intelligence), is that it is not always easy for companies, including retailers, to get clean data and the associated insights embedded in those data.
The challenge (and opportunity) is that customers are smart and increasingly savvy when it comes to managing their privacy and relationships with companies. Companies that fail to leverage the data they have, and act more intelligently because of it, will lose those customer relationships.
Supermarket customers are “forced” to provide information in order to secure a loyalty card that allows them to access the sale price for most items. In some case this means that they give false information regarding their phone numbers and/or email. However, because some do does not mean that it should be assumed that there is no useful or accurate information that came be used.
I agree with the comments that say what is the potential liability and morality of not even trying when you have the data. As a former retailer, I would be terribly disappointed in my team if they had not automatically made the attempt to reach out to our card base immediately.
We recommend to our clients that they use their data base to contact customer for a variety of reasons. One of the benefits of doing so is validating that data that you have so when you really need to reach someone you know if the information you have is accurate or not.
Some smart lawyer someday is going to say “My client’s child died, and your store could have prevented it.”
The feedback from contacting consumers with phone calls is overwhelmingly positive, especially when it comes to recalls. A targeted, timely, and important message has real value to consumers. My company, SmartReply, has executed dozens of recalls in the last two weeks for a variety of grocery clients.
Each recall needs specific handling. With the recent calls we have successfully directed consumers to websites, a manufacturer’s call center, an independent toll free number, and to retail call centers. We notify consumers in less than 24 hours.
Grocery databases are very powerful, and tend to be chronically underleveraged. Recall services are quick to execute, inexpensive, and recognized as a valuable service by consumers.
It’s unimaginable that any merchant would choose to forgo this opportunity to help their customers. This is a chance to touch the customer in a way that has nothing to do with selling and buying, i.e., it’s a chance to prove that the customer means more than dollar signs, while providing info that’s helpful and healthful.
Every merchant should use their frequent shopper programs for this type of recall. And if such alerts are currently not part of the program, then the program should be revamped to offer shoppers the chance to opt-in for alerts via email or phone. And there are other ways to leverage frequent shopper programs. As is, the programs are often used to merely access a product discount. Adding recall alerts and lifestyle info (like recipes, cooking tips, exercise tips, etc.) adds value and creates a bond.
Rethinking frequent shopper programs is long overdue. And the current recession is a good time to do so, since such content can help keep the brand top of mind while adding lifestyle value.
As a parent of three small children and the holder of three grocery loyalty cards, I would be upset if I DIDN’T receive a call from a grocer if they knowingly had access to data that I purchased a food product that could make us ill or potentially kill us if consumed. That, to me, would be irresponsible and a huge liability lawsuit waiting to happen.
Being proactive is not only the right thing to do, it’s actually promotes loyalty and offers sort of an “insurance policy” against litigation.
Additionally, it’s not only the grocers that hold the onus of responsibility. The manufacturers also need to cooperate more comprehensively with their outlets to promote the dissemination, by all means possible (pre-recorded voice mail, call center, mail, TV, radio, etc) of the tainted product they distributed to the marketplace.
I strongly agree with the consensus opinion here about using loyalty data for recall notification: if it is not a legal obligation, then it is at the very least a moral one (to say nothing of the positive marketing value on your store’s brand).
The front page of today’s New York Times raises a related issue in the article “Fallout Widens as Buyers Shun Staple“; namely, what do you do about similar products that *aren’t* recalled? With peanut butter sales off nearly 25%, the thoughtful retailer would look for shoppers whose peanut-product buying habits have changed drastically since the recall, and would target each of them with an informational campaign addressing their fears. Combined with an aggressive campaign to notify people who may have bought tainted products, the message would have real credibility in reassuring spooked shoppers. So you get a win-win-win: protect the customers at risk, build credibility with everyone, and increase sales of products whose sales were hurt by association.
The challenge, of course, is that few retailers have the tools or the time to put this plan into action. My company hopes to change that, but I expect it will be years before this type of proactive recall notification is the rule rather than the exception.