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Food Recalls: How Retailers Can Turn Shopper Frowns Upside Down

Food Recalls: How Retailers Can Turn Shopper Frowns Upside Down

Even when suspect food products aren't ingested, recalls can leave a bad taste in consumers' mouths.

Once made aware that there was a chance they could have contracted a foodborne illness, or have been exposed to an undeclared allergen or otherwise poisonous substance, shoppers are left with a limited set of options: Throw the item away (along with the money used to purchase it) or make a return trip to the store for a refund.

A recent Deloitte-commissioned consumer study shows that 40% of shoppers who bought a product that was later recalled chose the former course of action, while 35% returned the product, 13% stopped buying that category of product, 12% stopped buying that brand of product, 6% continued to use the product and a seemingly odd 5% kept the product but stopped using it.

The “Food and Product Safety and Its Effect on Consumer Buying Habits” study also found that more than half of shoppers who changed their buying habits as a result of problems with packaged food and beverages did so for six months or less, 24% for seven to 12 months, and 16% for 13 months or longer.

But just as the memory of negative experiences can be long lasting, so too can the fond ones.

“Recalls present an opportunity for retailers to establish consumer trust and good will,” said Pat Conroy, Deloitte's vice chairman and consumer products leader.

Dayton, Ohio-based Dorothy Lane Market does this by mining its shopper loyalty data and placing a call to each and every shopper who's purchased the affected item, Kathy Neufarth, DLM's director of consumer affairs, recently told me.

“It's a human being that makes the phone call, not a recording,” she said. (Wegmans has a similar system that leverages an automated recording.)

Despite having a proof of purchase in the form of POS data, shoppers are required to return the product to the store to obtain a refund, but they're not subject to any deadline and don't have to bring a receipt.

In fact, DLM has provided refunds for recalled products that it knows were purchased outside the three-store chain.

For retailers with similar access to loyalty card-linked purchase history, the post-recall targeted marketing opportunities seem endless.

If a consumer has made the decision to indefinitely steer clear of a specific brand or product category, why not compensate them for their troubles while inciting private-label trial with an offer for a free or discounted store-brand version of that product, or one from a similar category?

The same approach might be used to regain that shopper's confidence in a previously recalled product after a certain time period has elapsed.

“Everyone is sympathetic enough to know that sometimes things happen, but the way you follow it up is what really counts,” said Conroy.