TARGET BY TASTE: KNOW YOUR CUSTOMER BETTER 

Until now grocery and other retail marketing has been based on saturation within an area. The object: to try and get everyone within your marketing area to shop at your store. Store owners today know what they sell but they don't know to whom. An upcoming generation of retail marketing systems will "lead retailers to an unprecedented dialogue with their customers" according to Thomas R. Newkirk, Chairman of Direct Marketing Technology, Inc. of Illinois (DMT), partners and developers, along with Retail Consumer Technology Inc., of a computerized data-base that tracks individual retail purchases. A store is equipped with this system knows what customers prefer. It knows their tastes.

The system, which is called "React" is described as a "reporting, response and promotion package." React requires no special customer card to instigate tracking. Stores program cash registers to accept a telephone number volunteered by customers at the time of purchase. Every transaction is recorded and matched to that number. The system, designed initially for retailers with a minimum $7 million sales volume, will shortly be supplemented by an update handling sales up to $70 million. Some 1,300 retail outlets belonging to The U.S. Shoe Corporation have been testing the program in conjunction with DMT. Six other chains are reportedly in current negotiations for the system.

Customer phone numbers in the React system are processed by DMT through a reverse directory that matches the numbers with such demographic information as, name, address, gender, age, income, dwelling-type, average purchasing power of area, etc. Most of this information is readily available from telephone white pages, city directories or publicly-available government statistical records. Purchases are recorded by product category or stock-keeping units. Method of payment is also recorded.

With this informational data base, the retailer "knows" customers better. He can make sure that merchandise the customers purchase frequently is always in stock. The retailer now has the same valuable information used by mail order marketers. This leads to new cross-promotional possibilities. Marketing management now knows what customers are not buying. Retailers conduct low-cost, limited testing by drawing the attention of discriminating customers to new products before they go into mainstream sales. If customers cooperate further, anything is possible: reminders for birthdays, garden specials, periodic ordering of large dog food delivery or floral or deli "surprises" for certain dates. Another food industry innovation may soon be the new inspector on the conveyor belt. Humans on this job become bored and sloppy. Looks like their replacement will be a camera, two color monitors and a computer that detects size, color, abnormalties in potatoes, apples and mushrooms. Scrapes and cuts are easy, bruises are the big problem. All photographs are digitalized and assigned file numbers. These developments coupled with the "artificial potato" that contains its own broadcasting system, reporting on how it is handled from field harvesting to truck loading to processing plant plus the now-underdevelopment infra-red ripeness beam should reduce produce damage and spoilage considerably in the years to come.

More information on React: Jennifer MacLean, Vice President, Marketing, Direct Marketing Technology, Inc., Schaumburg, Illinois. Phone: 708/517-3600. On Conveyor Inspector: Professor Charles Morow, Faculty of Agricultural Engineering, Pennsylvania State University, University Park, PA 16802. Phone: 814/865-5471.

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