Sara Lee’s bread is making less dough

Somebody doesn’t like Sara Lee. It almost seems unfair. After finally recovering from the low carb diet craze of the 90s, the company is feeling the squeeze from private label, especially in the bread aisle. Thanks to the recession, customers are shunning name brand loaves (and cakes) in favor of cheaper private label starches in order to stretch their grocery budget. Sara Lee must also compete with price-slashing name brand rivals.

Not to pick on Sara Lee – other packaged-food companies are getting pinched – but you have to wonder whether Sara Lee fully understands the customer motivations and behaviors played out at the shelf that might be causing sales to plunge. The company knows profits are down, but competitors Kraft and Kellogg are turning in respectable numbers as shoppers trade takeout for meals at home. Does Sara Lee know why buyers are reaching for the doughy store brand whole wheat instead of Sara Lee’s innovative Soft & Smooth loaf? Does the company understand on a volumetric basis those who have come to the store fully intending to buy the brand, but then bail in the swirl of the last three feet? And why they bail? Is it price, promotion, packaging or an intriguing blend of yes to all that? Or maybe is it some other lure or allure?

Sales are an important, obvious, but crude measure of how shoppers interact with brands. If companies hope to stop the slide toward private label, they need to be where the in-the-moment calculations of the shopper occur. They need to take hold of the in-aisle thinking of shoppers who buy the brand, don’t buy it, and most tellingly, the ones who intended to do so and then decided in favor of another.

Keeping the customer

Bill writes: I can’t remember where I heard it first, but an expression I’ve always liked --- it’s used to describe how fast calamity can come – is the one about someone who just “pulls a single thread and the whole sleeve falls off.”

Cut to me at Whole Foods on a recent shopping sojourn. I had a grocery list of more than 50 items, one of which was watercress, that tangy leaf vegetable with the slightly bitter peppery taste that doesn’t have many uses beyond being filler for ladies’ tea sandwiches. With produce as the first department along the perimeter from the store’s entry, it was my first stop. After several futile minutes attempting to find the item, I asked for help. The clerk couldn’t find the watercress either. He went to the back room and looked. Nothing. Sorry, sir. I looked at the rest of my long list and my completely empty cart, and weighed my options. I could continue shopping and then go to a second store for just the watercress, or bail now and get everything done together at a single (other) store. I chose the latter, and with that decision, Whole Foods was out more than $225--what I ended up spending at the competitor.

What the Whole Foods produce guy might have asked is what I needed watercress for. Had he done so, he would have found out that it was to act as nothing more than a garnish for a plate of Super Bowl deviled eggs, a green bed on which to splay and display these old school treats. Then he would have been able to suggest Italian parsley or arugula as worthy substitutes, and I would have stayed at the store.

Is this asking too much of employees? Maybe, but I’m not so sure. Taking an interest in the customer has to go beyond “we’re out of it” or “it’s over there.” Finding out a “why” beyond a “what” is always a reasonable goal.