LAS VEGAS — To encourage consumer confidence, retailers must adopt an air of optimism about their businesses, despite the issues they must wrestle with behind the scenes, Al Plamann, president and chief executive officer of Los Angeles-based Unified Grocers, told a convention audience here.
“We must recognize that the business community looks at things differently than the consuming public,” Plamann told a general session at last week's annual convention of the California Grocers Association. “We face a lot of uncertainties today — about regulations, health care, taxes and other issues that create a kind of hunker-down mentality among retailers.
“But for the sake of consumers, the industry has to get out of that fog and offer something positive for everyone.”
Karl Schroeder, president of the Northern California division of Pleasanton, Calif.-based Safeway — who joined Plamann on a panel — said it's important for retailers to keep innovating to maintain consumer interest and excitement. “We have to take customer feedback and use it to innovate the ways we go to market, as we've done with private label. As people traded down, that provided an opportunity to take private label to a different level.”
A third panelist — Tom Corley, senior vice president, U.S. sales, Kraft Foods Global — said manufacturers must look to consumers to determine what kinds of products they want. “Consumer behavior will dictate what we do. As people change the way they shop, we must look at the categories we offer to retailers, along with the safety, quality and value of those categories, and introduce new items, ideas and promotions that allow us to compete better.
“For manufacturers to grow, we must hit the bull's-eye with the kinds of products that retain old customers and attract new ones.”
For retailers to grow their businesses, they need to have the confidence of their customers, Plamann said — something that's been harder to hold onto as the number of product recalls has increased, he pointed out.
“Consumers trust retailers to carry healthy products, and as long as we communicate honestly with them about recalls, I think we can retain that trust,” he said. “But there are questions about whether or not consumers trust CPG companies.
“Perhaps retailers need to work with those companies to improve communications because we can't let the bloggers, who look for the dark side of retail, to hurt our businesses.”
Schroeder said he believes social networkers like bloggers “pressure us and make us stronger,” while Conley said he agreed with Plamann that communications between retailers and manufacturers are necessary “to help protect consumers.”
Asked why some consumers would rather go to a fast-food restaurant than buy ready-to-heat dinners at the supermarket, Schroeder replied, “If you have a line of products you would use, then that's good. But if you would rather go to Wendy's yourself, then you need to innovate.”