“+588

USES OF MRKETIHG RESEARCH B! THE FOOD CHAIN IIDUSTRI

By
Eugono Shannon hhany

A THESIS
Sub-1%“! to the School of Graduate Studio: of Michigan
State College of Agriculturo and Applied Educ.
in partial fulfillment of tho requirenonta
for tho dograo of

MASTER OF ARIS

Department of Genoral Businou
Curricula in Food Distribution
1951

11
mmmmm ‘23

Thu mm In». to apron hi. than appreciation in Hr. Richer!
Earth-w}! tho lacuna-1n; reward wart-at of he Kroger 0mm
In his omnufi naporaua‘h mu; m mama» or am Marta"
available to flu mm and. for MI mmtmtivo «man.

up our food. diam annual huh haw furnish“). tutor-ail- for
mm in «that '1." to and» than.

Granule 1- also b. By... hunt Him. Dine»: at up Out-lulu
1: he! manna». for In: meat. tap-mun at mph]. ago.-
um 11 th- proparaua of an. hulk

Ago. Simulate"

mmcwms
om PIG]
I.IB‘TROMTIOX...................... 1
Fromm ............‘.........
11.nmmmnsmrmnqus
In. mnnmmnowm............. 13
IV. mien. 3101133 I! m mmmsm RESEAROE DEPARTURE 21
humuuiunmuu................. 22
Fractal-0pm................... 31
MMMW................... 33
WhorAtfimlnoportl.............. 3h
taunt-111339902“ ................. In
ioportuoncoupouuu................ 1&6
RuporuuPrc-ouou................ 1&9
Inhiulficpoflo.................. 51
lit-«11mm.................... 51
Panoloperauu................... 52
narorasnommcamlmm............... 60
n.3ESEABOEHOERRmIIS ............... 70
Salon’s“!!!.................... 70
Grandma»..................... 73
IoodFairstoru................... 13
Alphahta’oodlutok ............... W
camasam................... 76
Jual'oodstoru.................. 82
Pm’nuhqw 83
nun-13m. 83

6mm
brim 5hr” . . . .
J. ‘01::ng . . . . .
Banana). 1.. 0mm -
melanin. . . . . .
VII.

36pm» Departunt Vans 1-in- hunt!"

3110 d Depart.“

Quinta. 3mm». of Intonation

7111. mm AND CCNGLUBIWS

3131.1me

0

0

00000000000000

0

O

OEAHIZATIOH 01 A mm mm WARM!

1v

P163

L182 01 FEMS

new

organization of Kruger maintaining research department
Qnuttannairo ”01130111011381“ firm . . . . . . . .
Wuumofor no‘fln‘uppmol . . . . . . . . . .
Pandnoklyreportingfm .............
Stopfishopmmtlurnmmrhm . . . . . . .
flarkonng ”scarab dwarf-Cl“ of saflm 3%! . . . .
Quaiozmuo unwound-1 Sm: . . . . . . . . .

PM?

OWE}! I

XKTRODUJ TI CE

Tho pm» of thin thooio in to amino the moo of norketing re-
«aroh by the toad chain industry. [adding research in am a rela-
tiroly young imagement tool. only raoontly having come of age. There
are probably quite a few food chain executives. having risen throw the
ranks, that oro unfamiliar with narkoting research and do not realize haw
M can too it to their advantage. i'hil may. to some degree. be attribup
tea 5 thou practitioners of marketing research who have clothed their
wot in an esoteric who-Jumbo which in incomprehensible to the busy
ozoOIti'ro.

311110 Iarkoting researuh has generally been confined. to the l'rgor
corporation. Immune research ten light rail re-exwlne their t: ctios
to omhlo mo manor firm to utilixo this aid without on undue arts—in
on thoir finance. This theoio rill amino the rod: of various food
chain in this field wit a vi" to throwing some light on the uses to
which tho: can put marketing roooardi. it it felt that more food chain:
would expand their nerkoting roooaroh if they realized. how profitable it
can pron to he.

Thorn are a maher of reasons why mrketing rose-omit nhmid be a
grout holy in wiring tho problmo that confront chain store watems.
The food chains opera to on an oxtmlr‘low profit margin - a not of
hotwoon ono and. two cents on tho oeloo dollar is common. In View of

tho m1). profit margin find intense competition. increased efficiency

on th part of an: no flail ohmld noterinlly bettr'r its position.
lnrkoting research is constantly otriving for more efficient my: to
oporato a hisiness.

Retailing is a. dynamic field. Companieo either progress or retreat:
thsro is no standing; still. films. tho test solution to yesterday's pro-
blem no: not necessarily ho tho best today, and today‘s correct answer
may he outmodod tomorros. Quotiono are never arguing; answered in
tho fiold of retailing. larkoting research some the function of ob-
sorvins the dw-to—drg variations in business and matting the signifi-
cant trends that emerge from thooo seminal: random hapyenings. In an
absolute sense. marketing research is never completed.

m of tho secret of the min otore moo-on has been in the
otandnrdizntion of retail mitt. This phyoioal otnndnrdization of re-
tnii units, plus the standardization of operating methods and moi-clun-
dising procedural. should facilitate the work of marketing rrseardi.
Generally speaking. what is true of any representative group of store:
should to tan of all stores. Inna. omerilento in nerdmndia'zq; and
promotions could he onrriod out on s relativoly snail oozle. and through
Mfltive reasoning the results Gould be generalized to @313 to the
ontiro chain.

Tho mount of research in tho fiold of distribution is negligiblo as
oonpared with tho funds and onsrgios devoted to research in the field
of technoloy and production. in spite of the fact that distribution

in all its phones represents o noro important area. in our total
eoonow man does produo tion.1

 

l min but 0 Mum? (New tons: The Txmtieth
canton M. 19 l . p. 358.

Io tos nan: people the field of production is e science. while the
field of distribution is an art. for example. my sales masters. havh
in; sosksd up through the ranks. consider themselves salesmen at high
levels. rather than exports in the field of marketing. A vice-president
in charge of production on: pore over a trenty-y—ge coupler report of
tables and cmrts. submitted by his research chemist. since he is often
8. trained engineer. 1; fies-presidmt in charge of sales. however. may
pa: little attention to a twenty-mice mrketing research report. since he
say have little formal training in statistics and economics.

that there is e. difference between the fields of promotion and dis-
tribution cannot be denied. levertheless. wheting research is striving
to lake distribution more scientific by applying scintifis principles
which have long been used in ths field of induction.

It is hardly scientific when an executive imgims thet his wife or
secretary is the “typical” female. inflating research serves to mice
distribution. formerly a hihor-nisa prOposition, more hit than miss.

Linc sxscutives. eccsptina the status quo as the best say to do a
Job. an often unable to visualise s bsttsr say to perform a certain tr: sir.
larketin; research men. however. look at all things «1&1 a critical eye.
To the: a certain answer is not necessarily the best solution to a problem
lately bananas it is being done that saw at the preeent time. They oxen-
lac evsrythin‘ with n visv to finding a we; way.

Karla ting research non nut show top management how they can profit
“touch reward: techniques. Sound monarch end on inmili‘grnt egg-lice..-

tion of the reeulto are necessary if the fullest benefits are to be

derived Ira the research budget. 11’ research allovs itself to less
eight of the profit native as the real reason for its exietence, if the
nerehandieing and sales depart-ate tail to lake practical use of the
facts developed. and it top magenent allows either e! these things to
happen. then the noney spent is wasted.
A definition of the tern Marketing research“ would be in order at
this point.
larteting research. in the broad sense. is the stun of all the prob—
lem and nethode of distribution. he function of the marketing
research depart-eat. then. is to study the methods and problems of
distribution, including all the activities involved in the transfer
of goods and services from producer to oonsnner. and to present to
mount {cogs and reccnendations leading to increased efficiency
in this field.

The tern. as can be seen fro- the above. is quite broad. not this ter-

is sonevbat earphone is indicated in this study by the different lean-

ings ehich varions food chains attach to the ten.

Chapter It discusses the three techniques for collecting original
narketin‘ research data. hphssis in this section is on the controlled
experilut tedniqne which some to held not praise for food chains.
Obapter III is a general description of research vent done by the Kroger
Ooupmy. Chapter IV in a case study of the sort done by the Israel-
dising research depart-ent or he Kroger Goepaw in the past two years.
chapter 7 takes up the narketisg researeh work done by Stop a. Snap,
Incorporated of Boston. The available experience of other chains is

treated in chapter '1. chapter '11 diecnsees the petition of the nar-

 

2 G. Mark filo-pm Wmmw (Studio- in
insinese Policy. lo. 19) the York: fictional Industrial Oenferense
30m. 19““. Po 9e

5
hcting research function in the organisational pattern and also sections

the secondary sources which say be of value in a research department.
his chapter is vritten nainly tron the point of view of the smaller
fisin that has a rather linited research bndget.

Procedure

there has not been a great deal e! printed naterial on the uses to
shich a food chain can put narheting researdn. while Chapters 11 and '11
were based on secondary data. the bnlk of the intervnin; chapters was
derived tron ansvers to personal letters cut to the variens chains sen-
tinned. Each chain vac ante“ thether it had n marketing research de—
part-ent: it so. the sins of the departnent: the type of work done: and
to m the depart-at was ”with.

It was inpossible to get the desired intonation about a for food
chains. While this is regretted. it is felt that he intonation on
the chains nentioned is adequate te give a good idea of the current
statue of narkcting research in the food chain field.

he intonation about the Kroger Gunny is more detailed than that
concening an of the other chains. This is due to the fact that the
anther sac permitted to observe the work of the merchandising research
departnent for a considerable peried e! tins and was allowed to read the
reports covering the pact tie-rear period.

To deternine the extent of research done by others which could be
of benefit to the chains. letters vere cent to trade associations. nann-
factnrerc. sovernnent agencies. syndicated services. trade publications.
and advertising nedia.

CHAPTER 11
Mariana} momma recurrent

Irho purpose of this chapter is to discuss the three techniques for
gathering prinary data in urinating rose: ran. an unfierat-=n-iing of these
techniques is required to comprehend.better the marketing reetzrdh work
done by food 61mins. shidt sill be cited in later chapters. Such a dis-
cuseion should serve to orient those unfailiar with the field. «an.
much of this chapter may be ”petitions to the cagnoacenti. street in
put on the horetofore rather neglected experincntal technique which
scene sell suited to the particular needs of the food chains.

To a great number of people the words “surrey" end I'xm:-.rl:et.111,3; re-
search“ are almost anemone. The average layman has no idea of the
large number of functions that eanibe.performed,by'narketing rese:rch
non. using techniques other than the survey. Despite the frat that the
mm is the nest frequently used technique. it is conceded to be less:
accurate than the other tvo nethods. the observations-1 and experimentrl
techniques.

Before proceeding further. these terms should be defined. lydnn O.
Brosn. eniunt marketing research scholar. offers the following; «calmn—
tion of these terms:

Til essential element in the survey mthod in that the data an fur-
nished by an individual in a conscious effort to ans er a question.

The observational method relies on the direct oboe-rm: ticn of physi-
cal phenomena in the gathering of data. The emerimental method is

essentially the procedure of carrying out on e ems-.11 ec:.le a trial
solution to a. problem.)

Since a survey necessarily involves a human being in a. conscious
effort to answer a question. it is meeot to error unless cert.” in pre-
cautions are tamn. In surveys there is a wide rage of vio'rpoints with
which different persons nry look at the same question. Ekifferc-nt terms
mean different things to different peeple. and eubj active anew-re which
result fron mess differences are sometimes unreliable. The haw-n emery.
a tenuous thing. often compounds the error of survevs. Decpito the so.
limitations. however. the survey is n ted'tni-fgne Wick is ‘wll 4% xitr-d. for
mny kinds of rose: rch.

The observational toot-niece is superior to the surrey in test it is
less on“ active since any possible subjectivity can only be unilateral
(on the part of the observer). while the survey is liable to bilateral
subjectivity (on the part of both interviewers and respondents).

The experinental method is the nest scientific and objective of the
three nethods. but has not enjoyed a very wide use. However. were is a
great deal to recommend it in solving a number of nerdnr-ndisiw problems
that arise in a food chain. These food. firms have. to a large. extrnt.
standardised their retail units as to layout and nerchsndising policies.
nut is effective in one. therefore. should be effective in another unless
there are strong extraneous factors that must be considered.

The orgmrimentzzl method. of course. is widely used in all the asturfl

sciences. From their experinents the scientists rerch overall concluriorzs.

 

3 Lydon 0. Bro-an. EPTI-fé‘ti'r. and T‘ictribution Poeo'rg“; (Bow York:

'I’he Roland Press Compvny. 195- ). p. 93. 311. we. '53.

   

fliey attemt to hold all the variables constint ascent the. particular
one inch is being attuned.

Although it is possible in tbs physical sciences to hold all the
variables excqat one constant. in the field of retailing this cannot be
done. Since it is impossible to hold the other variables. such as weather.
competition. et oetere constant. it becomes necessary to allow these on-
controllable fnctore to exert flair effect simultaneously on a number of
stores. 11'. therefore. these factors are working on two groups of stores
in approximately the sons mner and the variable to be measured is the
‘ only apparent difference betvecn the two groups of stores. controlled
expert-ontetion is possible.

1‘!» group of stores in one: the variable is to be tested is the
test amp. while the gran) in vhioh the variable is not present in the
control group. “the stores in the one group should. be quite comparable to
th‘ stores in m other gm in e umber of respects. fillies! innit-brunt
of stop O shop. Incorporated reoomends the following: t-n-itez-ie:n

1) m 9; stage - super market versus service store. number and
tyres of departments:

2) sizes of store - dspertmntel and total weekly sales. weekly
customer count. store ares. else of perkig lot:

3) Wm- size or city. location of store (rural. suburban.
rbsn. metropolitan). eoononis and racial grows. competition:

It) m m - means of reaching store. sex of seJority of-
custaners. frequency of store visits. length of patronage.
average size of sale.

01' course. all of the above factors say not be of importance in any

one test.n it is up to the nerksting research can to deter-ins Just which

 

1‘ time; Applebenn. “controlled Experimntntion in Herketing
Reseafli'. 1.22mi 2!. “4:52.113. 1mm. January. 1950-

9
are pertinent in any one inetance. fir. Applebau eaye that it ie cutou-

ery in hie cenpeny te nee five etoree each in the control and teet groupe
in noet etudiee. There ehonld. of come. be en additional group of
etoree fer every additional variable to be tested eimltaneonely. It in
quite impoeeible to deter-inc Jnet how Inch of the effect ie due to each
of the variables.

In neing controlled experimtation. it ie actuary to get a baee
period in both groupe of etoree which ie need no the non. Following he
beee period in the teet period. The poet-toot period to quite often aleo
calculated to eee the enbeeqnent effect on ealee of a certain wpe of
prouotion. 1'heee poet-tut neaenrenente tell rhether future purohaeee
were norttaged or whether additional eelee were created.

The research can nenelly infer: the etere teenager of the forthcoming
teet when the epeoific etoree are deter-ind. Each and every full-tine
end part-tile clerk ehould be told of the teet. leet he in com way
interfere with it. Almost alwm. en endit of nerohandiee in the etore
ie reqdred. Such andite ere anally made by the supervieore of the
reeeeroh proJeot. Store manager! ere eften too busy to devote their
tine to compiling accurate figuree.

If the teet ie to be of a rather short duration. deliveriee to the
etore ehonld not be need einoe they indicate movement from the warehouee.
not eelee. Over an extended length of time. however, deliveries to the
etore would give a respectable lea-Ire of ealee.

The reenlte of theee teete are usually given in either phyeical
Ilite or in dollar ealee. or eometinee in both. The net result of the

variable being teeted is found by enbtreoting the change in the control

10
group from the- base to the tent period from the change in the test group
over the some period. Aiming that a certain brmd of was is being
displayed in a test, the following example may clarify this point. If
the control group. where there was no dinghy. gained 5 percent during
the teet period and the test group. with the pone on display. eold 25
percent acre of the brand of pone during the test, the net result attri-
butable to the deploy. the variable. would be 20 percent.

‘33 cancel out the effect of store nine. the results; are expressed
5:3 ealee per one hnnired dollars of total store sales in some inst-“noes.
Thin reflects the intensity of the nerdinndioiqg effort put behind an
item. rather than the store eize. In other instances, dollar sales of an
it- per store trench-Lotion my be an indicative ratio. Hr. Applebenn

earn

In general. both dollar ealee and unit ealee reeulte ehonld be
neaeured in relation to total etore ealee. to deporment sales. to
more of the mr’aet. and to the number of transaction. In may
etndiee the costs required to get the calee results and markup dollar
profits produced must {also be analysed. Fimlly. it may be necessary
or desirable in some eoeee to measure ealee results in relation to
linear shelf frontage, store floor area occupied and cubic area in-
volved (in equipnent). ct oetera.5

Food chains can use thie oontroned exyermntation type of research
in eolviog a number of problem. Pan-raging, for inetanoe. can be made
more scientific by ouch reeenroh. Teete of different packaging mteriale.
cash no glare vereno tin. can be node. Tents of different on oksge ei zee
mld be teem. for own, in deciding mother to put oranges in mesh

bage of five or eight pounds.

 

5 hide. Po a2

11

The long controversial abject cf the benefit of dieplr-ye in food
storee can be eolved by the use of each controlled experimentation. Of
course. an item dieplared ehocld eell in greater quantities, Int it must
be detenined whether 39—! eclee ere enacted or fiether colon are merely
ehiftcd to the dieplea‘ed brand. fron other brands. recto hzve also been
solicited on the mount of ehelf epece given to an item and the effect
of vericne eblvee on eclee. Step I. Shop hoe conducted teete en the
mnnguent of merchandiee on special display. the I110 of displays.
single iten versus mltiple iten dieplaye and the prediletive life span
of dieplaye.

There seem to be a great deal of men for imrcvemnt in pricing.
Controlled emerinontntion an: be quite e help in thie remeet. The
rule of thub ie often the means of erriving at a retail price. Price:
that repreeent a certain lax-gin ever coet often are arrived at without
coneidering the “and for en ita. he electicity of demand for an
item ie e very difficult thing to determine. but controlled experiment-
mccld be a valuable aid in equating margin and sales to practice the
maxim word“. Dollar prcfi te are each core important than per-
centage fiance.

It ie certainly meible to try out a promotional scheme on 9. small
scale before risking e large amount of money on it. Controlled emeri-
mte are ideal for this type of thing. Soles executives are often
carried new by fantastic eehelee, and research not ehce then the error

of heir wage before the coupon lceee none: on cub echenee. "New e

1?.
promotional idea. even though conceived in ecstacy and gestated in great
hopes. and! in miscarriagcl'G

Emerita“: in selected teat star" help in deciding the sales po-
tential at a suggested an item or lino and will give an idea of what
effeci it will have on the existing campetitin products.

In market research 6.0%th of Sup I: Shop ht-a even used. con-
trolled experimentl in adopting not store equipment and in work singin-
fiation.

Although the experimenwl method can he of such uervioe to. maevrch
wt in tho food chain 31.11. m linitationa must be recognized. It
is. of cow. muslin to latch two stores partway. to that thus
in only one variable between flu in. Still. if «numb stores are
chosen. this in not very scrim Thar-o is always ihc possibility that
adorn will mi be followed by atoms personnel. Honour. the emr1~
menial :3th is usually rather expensive. Much can be expected of it.
but it du- han Mutation. The mm will be lith u- tor year- to

com.

 

FM. p. 51“.

0&3?sz III
Rafirlmiflfl 3! ma: [MEL-fill 002331137

The purpose of this chapter in to consider the marketing reae; rch
work done by the Kroger Gcwany. Emile it ie realized that this organi-
zation can afford :a much larger research Midget than most food ctr-inc.
it is felt that much in to he learned in the way of principles and
practice tron such a etmiy. Sm of the tedmiquec mticned might well
be edcpted on a smaller “13.10 by came of the rcgionzzl am! local chains.

The Kroger Company. vith 1950 sales ef 861 million dollars in over
he Miami stores. carries on various form of w-rketing reseerch in a
rumor of departments. the budget and statistics 69;): rtment c rriea on
research in the form of sales analysis. The advertising, department does
copy an}. media meetrdh ‘Ihc real estate department does: reee—-:~~rch con-
corned with store fixtures and cite selection. The market analgesic de-
partment wnducte research on market trends to determine the proper tine
' to purchase the mricue staples that Kroger not w in such prodigious
quantitiel.

Krcgor'e unique department. the Food Foundation. in concerned with
technical research and. product releemh. The Kroger Foundation has e3-
tablilhcd. a panel. know at the Homemaker-I Reference committee. to obkin
consular reactions to productl in which it is interested. This group
ccnIiItl of 750 homemalcere who have been carefully selected in line with
than three requirements:

1. Representative geOgraphicel distribution throughout the territory
carved by the (imam. Each county thuc hos its quota of the

membership in prepcrticn to the lumber cf retail outlets quanta-J
in that area.

11+

2. High. medium and. low income brooks to represented in the pregor-
tions indiceted. by the latest available stetistics.

3. Distribution of ages s this the group corresponding to the
latest census figures.

Except for the war period. the panel has been in evistence since
1933. It has been used on a wide variety of products end subgcctn is
the course of more than 110 tests. The panel newborn are so oocperzztivc
that n response of better than 80 percent is genera.

Although the panel renters receive no remuneration. there is little
difficulty with members dropping out. In fact. there is always a lrge
Iciting list from which to recruit replacements. A high degree o3
Mfim exists within the committee. and. to members seen to
consider twelve: an integral part of the Kroger organization.

Panel where receive two samples of the commodity moor study. (he
couple is e product of known acceptance. while the other is s test sample.
more is no scene of recognizing the samples sane the labels have been
removed. and both samples are packed in identical containers. i‘hese
samples are carefully coded to avoid hiss. Emile both lettsrs and nu-
hers have fonsrly been used in coding. color codes have new been adopted
since they have the advantage of being non-comittel and easy to apply
rapidly.

The Kroger department thich is exclusively concerned. with marketing
research problems is the merchandising research department. This is the
only archandigig‘ research fiepnrhcnt in the country. This appellation
stems from the fact that this department works in very close contact with

George Garmtz. “But tint Do the Qoneuners shy?" Fog; Lndustggg.
22:13314. July. 1950.

15
the various merchandieing departments. Ito research is almost exclusively
restricted to the solution at sales and merchandising problems and, there-
fore, nre narrow in «3093 than the ml marketing ueenrch department.

The urchandieing research depart-ant ie one of four cicpartments
under the Director of Sales Promotion, sho is. in turn. responsible to
the Vice-President of Earnhandising. he other three depertmnte under
the Director of Selee Promotion are: advertising. sales promotion, and
sales planning.

The merchandising research department (hereafter referred to as
‘the depot-mt“) clears its findings with the. Director of Ssles Promo-
tiec fir” and then preconte that to tap loungemcnt. 1.0. the president
and vice-presidents. Once the bleseing d top management on the research
he been obtains}. it is passed. on to the divieicn managers (there are
f1” athletic) hm but to to lunch Hangers (there are 25 branch“).
I: having the results paused ion can train of canard in this M.
the ”cults are put to better no. fire the findings to pass direct]:
fro. the department to the various brandsee. some of the branch executives
night tend to loot: with sheptiein on ”nothing the depart-set had passed
a. as being theoretical. M wit the sanction of the top enles execu-
tives these inane are core readily eccentcc by the lower echelcne. Ire-
.qmtly the department rill send one of its non out to address a coating
of divieiu er branfl exmtivee in order to ”cell" 0. certain bit of
reseerch.

To prevent the idea that the research is done by e group of theorists
rho live in an ivory tower, every effort is made to have the race: rch pre-

sented in e napalm. easily understood tom and to outline clearly and

1’3
definitely a progrem of £129.51... In all tso any 1‘1 ms w rice-tin; rmr. 2c};
is received with a. "sell. that'c nice. but amt good does it do me?“
attitude.

One difficulty in any marketing resesrch Operation in a. food. chain
in that good rase;.rch men usually do not hLVE a very extensive bsrclground
in the grocery business, and good grocery nen usually have a very slight
buckgmnd, if any. in recur-rah. This presents no insuperabla difficulty,
but does necessitate a close degree of coordination between the (legat-
manta.

In years past almost $.11 the projects: of the department were in
answer to a specific reguest from either a branch executive or someone

from the general office. At present. however, about no percent of the

, {Wtk originates within the apartment. T1113 trem‘a e-nr-blcs the deprartmcnt

to nndcrtakc long—range studies.

the research tic-pa rtnent is different from the other fiepor tmenta of
tho compaw in that itc benefits are often intangible 5nd Elena—term. It
tho capartnent were to be discontinued tcmorrow, the stores: would go
right cl Operating. Eh: gain: realized from constructive research are
often not discoriblo on a prcfit and ion statement.

Ono long-range goal of any marketing research dwartmcnt in to gain
the confidence of those who are to us. the results of tho research.
Research. 22.1% has no value: only in being, used does it yield a return.

In the course of n study the nerdmndising research dcpnrment might
find. that a certain thing has been dam wrong for years. Yet. it must be

careful of the warmer in which this fact is disclosed. Subtlety in

17
requiroa in such a situation if the trouble is to be remedied without
losing the good will of the person involved. I! it were to alienate tho
acrchendi core, the deportnent would. he" no valid reason for its axis tenco.

than tho department is approached to do a study. it tries to deter-
min. in carom. vhetbor the research will be put into use or will merely

/gnther dust in n filo. Son. pooplo would prefer to use moor. rch only if
it happens to cubstmtiote their pro-conceived notions on n cubJect.
This degortncnt must act as c brake on illogical schemes and. try to see
that past research is utilized. It not also resist ottenp to to rush it-
work, since good research takes time.

Theoretically. the department could bring about a large grain in
sales Velma tomorrow. Sines it is dealing with folli'blo hwmns. hov-
evor. rather thm machines. progress necessarily comes in small steps.
moor: must constantly give we: to diet is possible in view of the condi-
tion. of the conxgany and its competitive position.

the Kroger Com‘gau’ has done marketing research work for over 25
grams. 0! course. in its initial stages such a department consisted of
only one man. Each year the department performs more and more useful
tasks for the coot any. Its annual filo scans to thicken as the years go
by. Its staunch position in the company is verified by the fact thrt,
Insurer a merchandiser presents a. promotional ecteme to the operations
section of the mug-paw, ho is usually asked. “Disl Rose: rch af'prove tztic
scheme?" A negative rozly to this query makes the adoption of the pro~
ycssl rather unlikely.

Tho merchzndsing research department of the irgor Coupe-raw con-

cists of ten peeple. as can be com tron Figure I. These are: the

 

 

 

I ‘ [wager Jl Secretary

 

 

 

 

 

 

 

 

 

 

 

 

 

Inn-ms longed
f I f l ' l f
Senior J uni or L Gonna ri son Stenographsrl
Field Sta! 1' oboppim
Staff 23 Soft
(I?) (E?) ' (2')

 

 

 

 

 

 

 

 

Fig. 1. Orga.ni:L‘.’tion of Kroger merchandising research deprrtsent

nansgsr of fins department. his secretary. tho assistant manager. two
sonic! staff non. two Junior staff nan. two comparison choppers (women),
.ond s stonographsr. m lioness! has n background in ”scorch 11th on
advertising agency. His predecessor is nos with the Office of Price
Stabilisation in Washington. The comparison shoppers visit each of the
oompew's 25 branches at least onco n year and cheek Kroger price-s 2.43:.th
fro-1'0 to four strong local competitors. iihe Kroger branch is not erusre
that it is being checked until tho shook is completed. The dozxartuxent is
amused by local help shonenr s'mber of interviewers are required in
s certain localiw. 2

us department tries to do ss littls routino renew-on as possibls.
it hslps the other dopartnsnts of the coupon in setting up research pro-
osdnrss. but can the prossdsrs is establishsd. the routins application

of the formula is left up to the deparment concerned. me real eotte

19
depsrhsnt. for sample. nay consult the merchandising research depart-
nent to dcternine a routine procedure to follow in selecting store sites.
m urshendising research department gladly contributes its specialized
knovohv to the problem at hand. but the approved nethod is turned over
to the reel estste department for dado—day application.

She dqmrtnent is tending use; frost problem that have only c local
application to problsss net are coupon-side in scope. In line with
this. it is turning over to the branches certain functions that it had
previously performed.

mm. the dopertmnt still checks prices in each branch at least
once a year. it strongly encourages the branches to do the routine prisc
checking of competition. its snslysis for reasons behind s poor showing
in s certain area has. to s great extent. also been hand over to the
branches. on dept-arm!“ has laid ion a pattern to be followed in such
cases. Sui: s pattern includes 9. cowmtive price check. customer inter-
views. mo: of advertising lineage. clad on competitors. volume. at
esters. All this is on the theory that branch personnel are in closer
contact vith the immediate situation and mould be able to case to a
correct solution in a shorter time than nerchandieing research men could
teceusc or their unfamiliarity sith pemlier local conditions.

an dspertnent is ready to cooperate with as: legitimate organiza-
tion in research that sin to nutmll: beneficial. Kroger has conducted
research in conjunction with the United States Doperment of Agricul tore
on certain urbting prom!" ond with the Coca Cola. Company on the best
loans of beverage merdxendising.

20

The dwartnent has recently node an agreement sith the i. 0. iioleen
Gwen shoreby Kroger stores are svaileble for Hielsen’s tabulation in
return for which Kroger is furnished the iielsen Index. The index is of
united value. however. since it is based on national figures. and Kroger
is only s. sectional chain.

Kroger he s. sililer errengcnsnt with the industrial Index, which
is sililnr to the Iiel‘sen index. but hes ends on agrees-ant whereby it is
ebls to get sales figures which are broken down geographically. Tron
these. 0! course. Kroger can get the information for its own territory.
Even fiese figures. however. are of limited letle since they represent
the magma. They are of sons value in comparing [roger relative
movement on certain conncdity groups to see it an average or better than
average Job is being done. Ierchcndisers. however. ere prone to bOast
of the itens on which they do n wsrior Job. shile ignoring those on
which they don't {are so well.

'i’he department has its budget Just as does every other department
in the Kroger Gonpenw. Although it say seen difficult to budget anything
so uncertain and intangible as research. on the basis of past experience
plus e. kneeledge of the pacific Jobs tint will probably be undertaken in
the colic; yenr as rather close estilete can be node. A supple-onto”
Wet is available if nsmsery. but is seldom needed.

i'hers are no standard costs or Job accounting systems in operation
in the depart-Int since all sort is done for one client. the Kroger Gon-
pcny. Sash syntens are only necessary in fine thet do work for outside
Clients and not be able to estimte costs closely in advance. There is

no allocation of costs to the dqartnents served.

6mm 1'
TYPICAL 51113155 3! m EBRCHAEDIfiE-‘fi 233333.233 DB’A'Rl‘iili

This chegter is concerned with the studies utmost-taken by the Kroger
merchandising research dopnrtment during 19149 and 1933. The studies have
been broken down on the basis of the subJect of the report and also on

the basis of the research technique used. as can be seen in Table l.

TEBLE 1
3.3351130}! PFHFOBEED ARE TMHIAIES U553) BY m3.

anomalous menace uno- yam—3r or me
names corms! a 19149 1.311) 193)

MW

 

 

$353.2: lumber Emerinsnt Survey Gheervation Secondary
Herchendising 20 ll 7 3 2
hrs-inns 1'! it 12 l -
New Line 12 12 . - «-
the toner
Attitudes lo - 8 l 1
Advertising 8 ‘4 l - 3
competition 8 ,"’ 1 I} 3
Promotions 1+ it ~ - -
technical 2 l - l «-
m .5 a; 3.6: 30 lg 9 A

 

0f the 82: reports in the two-year period. 35 were completed in 131:3
and In in 1950. e merical breakdown as given above is subject to the
limitation that some reports represent a much greater amount of research
than others. One report. for example. coy emries nonths of study.
while another no: W130 the work of only a week or two. Despite this
limitation. however. it is felt met the broo‘idOwn gives :2 reassembly

accurate conception of the work done by the. dep‘rtmnt.

22

As can be seen from fable 1. each category has been broken down on
the basis of the research technique used. The column headings have all
been discussed previously with the exception of me one hoeded ”Secondary.“
his calm refers to the nine reports shich were not the result of orig-
inal research done in the department. but shich were breed on secondary
sources outside the oompm.

The discussion which follm will describe in some detail each of
file types of reports gim in Table l. in some cases the results of re—
search sill he mentioned in passing. The lain. interest. hosever. is in
the problems and research procedures. There is no interest in the answers
to problems 29;. a. Results are mentioned only where they serve to
clarify the cathode of probles solving.

Isrshncdising Reports

Promotional schemes are geared to get oustosers m the store.
stile nsrchendising is primarily concerned sith selling m merchandise
to these customers once they are in the store. Promotional efforts.
therefore. are measured by increases in customer count. shile memorandu-
ing efforts are manned by increases in dollar sales.

The controlled experilcnt technique is the most revered for merchan-
dising studies and is med whenever possible. This type of stufiy was used
to determine the effect on produce sales men a certain store was con-
verted to a complete self-service produce department. he complete self-
sersice produce departmentwns compared to is average of {cm- sinilnr
predme deparhsnts thus were not coupletely self-service. nu ma

23
lasted for 2'4 weeke. end he one tlle perled of the preceding year was
teed ee the base period.

Comparative figuree were gathered for the bane and test period: for
the teet and. control etcree 11 all tree depart-menu. It was reasoned
that the relationdlp between total grocery and neat eelee and produce
ealee ehmld be the cane inbofi: groups niece the variable in the test
etore - fie one-hundred percut eelf-eeretee produce department - caused
a “muwmhange.

To on flat the produce Inlet would have been in the test store if
it had not been converted to conplete alt-service. the following calcula-
tion were made:

lncreaee in control group groeery end. neat ealee tor the Queue}:
period,

t 3 increase in control group produe sales for teet perlod.

c a increase in teet store grocery and neat ealee for alt—week period.
a e inoreeee ln teet store produce eelee during test period,

3 e bureau in tent etere produce ealee if there were no variable

between to“ and control grew (Le. if teet etore van on eer-
vlee precince baele no control etoree were).

eatncsx Solve for x. The amount )1 thick 6. exceeds 1 1e fie
extra Reine” gained ee 3 reeult of the variable. e. one-hundred
percent eelbeerrlce produce department.
Inelfied 11 this study were flan-cc on the out of a complete self-service
produce department. The ehrlnkage was due figured. ee was the average
produce eele for both groups (cuetcner cont divided into produce sales).
Another expert-entel merchandising study sought to deter-inc whether
apple-entail. neplaye 1n sacral produced a net gain. By not gain was
lent the gre on profit free the extra nercbendlee cold since the labor

cute of handing. tantalizing and removing each displays.

2h
Thie vac a very extensive teet. It was conducted in (an etepe:

l) in enalreie of the current emplemutel <1in:7 policiee end
nethode of typical Imer trench“:

2) An answer to the queeticn. "Dc ewplemntel dieplaye in general
cruelly result in Honourable net gain?"

3) It not. will specific types cruelly result in a measurable net
gain? If co. Ihet typee?

1i) If not. will specific commoditiee anally result in a measurable
net gain? I! e0. which commodities?

Ae part of thi e comprehensive "My. a tent of the effect or apple--
nental diepleye on eix widely varied commoditiee was conducted. Eight
etoree of comparable ealee volume and etore traffic were selected for
theee taste. The products involved were: Libby Peaches. Kroger Pork and
Scene. Kroger Blended Juice. 1:050 (three-pound ehortening). Kroger Soda
creature. and Kroger Salad Dreeeinx.

The plan was to have all eight etoree rel e two-net base period
during which tine no tested lten or like commodity within ite group
would he on enpplenental diepley. During the next tee-week period the
above eix cmnoditiee vere put a eupplenentel dieplq. three eech per
etere. Ac en illutrcticn. thie ie the we: the program wee eet up.

'1' ércnp of Storee

n m m am
Libby Peachee Krozer Blended Juice
Kroger Pork and new Kroger Salad Dressing
Imo Kroger Soda Cracker.

'3' Group of Steree

M3 mu m Me. an 2&1;
Kroger 310106. Juice Libby Poached
Kroger Salad Dre cling Kroger Pork and Beans

Inger Soda Oreokere Inge

25
In this way a tent group and control group were eet up which could be
owned to e common base period during which a relatioemip wee estab—
liehed between etoree. Following the tee-week test period. all itme
were returned to normal ehelf epace. and e poet-teat period of tee weeks
was Calculated.

lnventcriee were taken cent-weekly in order to determine erect sales -
early yea and late week. In addition, a record at etore roo- end shelf
etock was nnintained.

Sample tine studies were condmted in the etoree on the dnye when
the eupplmentnl displays were built, so that labor coete could be
studied. and it could be deter-lined ehether geine exceeded additional
coete.

Since the test was to determine tether additions; sales were created
or whether eelee were merely ehifted to the displayed item, sales on the
total commodity group were figured.

a. etudy ehowed that there is no unequivocal answer to the question
cc to whether eupplenental displaye provide net gaine. The etndy showed
that flee Vpe of display - ent—ceee. end of fleet. table. et octere -
wne not a governing factor in the emceee of e diepley. The teet proved
that the cannodity dieplayed doee determine tether the display will be
neon-m. In other eorde, certain commoditiee vill prodme net gaine
em e empimtal dieplay ie m5 or the eix item dieplayed. only

two caused an increase in the m cmmodiw group. To enemrize .. mesa

' e nemee eleo e emulation of price. eeneonebility. end
liniler factore.

26
displays cannot be expected to produce a net grin on every commodity
simply as a result of building the displsy.

The gross profits resulting from each displ: y were given, cm? the
labor expense 0" building the displays was also computed. Pictures of
the displays and graphs. illustrating the results. helped to clarify the
report.

A rather extensive emerinentnl test was conducted by the department
in conjunction with the Goon Gels Gowany .on the subJect of effective
beverage nerdmndieing. The test ran for 15 weeks from July to October.
The 29 test stores were located in three different Kroger branches and in
the territories of five Goon dole bottlers. The study tested the effect-
ivene es of the five stzmdnrd sethods of soft drink merchandising in com-
bination. The 15 week test was divided into five periods of three weeks
each as follcwsx l) shelf display: 2) carton reeks added: 3) coin
coolers added: 1:) mes case displays added: and 5) mass carton display
added (mess case displays removed).

The test stores were selected by the merchandising. resesrc‘n dept: rt-
nont. while they were not an exact cross section of all Kroger stores.
thq were selected to give a representation of ell Kroger stores. as to:
type of store, size. value. type of neighborhood, geogrr-phio-r-zl location,
and levels of soft drink mrchendisim.

The last phrase about levels of soft drink merchandising needs expla-
nation. The 16 stores which merchandised primrily from shelf displayc
prureseed through all subsequent test levels for 3 total of five periods

of three weeks each. The ll stores which already nerehendieed throw

shelf display and carton racks progressed through the coin cooler and
mass display levels for a total od" four periods. The two stores which
already mrchandised through s combination of shelf. carton racks. and
coin coolers progressed through the mes display levels for a total of
three periods. me average of all non-test Kroger stores in test cities
was compared with the average of the test stores.

Tb results were broken down as tot average case sales per Iver-k per
store: percentage of gross profit on Coca Cola: dollar profit on Case
Gale: and profit per square foot. The test data showed clearly that the
three Isthcds of soft drink merchandising - shelf display, carton racks.
and coin coolers - sre most effective when used in combination.

the report based on the test was quite enthusiastic about the use of
coin coolers in stores. The figures from the test on sales value and
profit free a coin cooler were projected on an annual basis and were
quite impressive. Various calculations showed how profits would be
affected by depreciation on the cost of the machines. The appendix to
the report gave the rental, sales and lease policies of various Coca Cola
bottlers on these coin coolers.

Other emerinentel eerchandising studies had to do with such things
as the use of shelf extenders. displays using "home-tote“ begs. supple-
lentel displere on white bread and he use of e. cloth beg imprinted with
toy cut-outs for Kroger flour.

The sun of the tedlniques used on merchandising reports does not
equal the total. twenty, since some reports were be sad. on a combination
of techniques. there were three reports in which 8 combimtion of tech-

niques was used. The survey technique was used in all three of these

28
reports. end. it wee combined with the engeeriznental method in one and the
ob ear-rational method in the other two.

The survey and experimental techniques were combined in a study on
banana: covered with a wax preservative coating. The study con ei steel of
three parts! store sales comparison between regular ens“ '=.mx coated
banana-3 otore interviewing: and home interviewing.

In the etoree comparative record: were kept of sales. bananas re-
finned for sale and those (ii-carded for both the ragul'r and testes-flown.
The natural bananas were pieced on one table. while the wax coated. Enema
were on the suecent table. Both were offered. sat the same price, and the
lyecially coated bananas were marked as such.

new shop-"bars were asked uh ion Wye of Malena they preferred and
the reason for their preference. They were also asked how soon they and
the bananas they bought since the wax coating was supposed to preserve
the bananas longer. More than 80 percent stated. that they need the bone-
nae within three days (counting the first dew es the day of purchase).

In the home interviewing part of the study four regular ham-ms and
four wax coated bananas were delivered to 209 homes of varying incomes
in Cleveland. The two kinds of bananas were marked '0' and 'T'. and the
respondents were asked to otate their preference by letter to avoid bias.
A for dare later, interviewers returned to the homes where the banana:
had been left and asked which type of banana was preferred as to: color,
hoping quality. finances and taste. They were also asked their over-all
preference.

A regort that. was based on both the survey and. observstioml tech-

niqnoa had to do wifix contour acceptance of the uniform one-pound Kroger

39
seafood package. Something new in this test was the use of e moving pic-
ture camera to record on film customer actions ehen shopping for seafood.
Personal observations supplemented these picturee. and the women were
interviewed when they left the seafood counter.. The camera was situated
so that it could not be eeen by shoppers. The women were asked the fol-
lowing questions: 1) Are you a regular Kroger seafood metonerh 2)

Did you intend to buy seafood when you came into the etore'ft 3) Did you
find the type of seafood you wanted" 1%) Did you have 8!? trouble finding
the type of seafood. I?! wanted in our seafood case?

A and: that combined the same tvo technique was conducted to de-
termine eh: bread sales in tin Kroger uuphie brench were falling off.
First of all. Kroger etore personnel were interviewed to get their opin~
tone on Kroger Breed. After talking to etere personnel. it was decided
to analyze bread sales before and after breed delivery in relation to
customer traffic ee recorded on each registere. It was alee decided te
interviee woeen in Kroger stores to get their Opinions on Kroger Breed.

the study showed that breed deliveriee varied from 10:30 Ll. to
3330 PJ. The uncertainty of delivery caued Ian: eteree to be out of
bread for a considerable the before delivery. The merchandising research
dqaerhent estimated that this outdated: time averaged at least thirty
lint" :1 day. Estimated movement for thie tine wee five loevee per
store. Store personnel thought that the psychological factor of women's
thinking that Kroger Breed was dam-old util the afternoon delivery came
wee e big factor in retarding breed eslee. To check this. breed eelee
were elected in relation to the ether of treneeetione both before and

after delivery. Only thoee ineteneee where storee were in-etock until

'50
delivery were included. it was fond met breed sales were poorer in the
'before' delivery picmre (114.5 percut) than in the “after" delivery
picture (81.1 percent) i.e. the number of loaves sold in relation to cash
register transactions. Thus the estimated loss of three loaves per day
per store was due to this condition. Correction of these two factors. it
was estimated. vould increase breed tonnage by 9 percent.

or the M3 women interviewed in Kroger stores. only 6 percent pre-
ferred Kroger Bread to other breeds. while 17 rel-cent preferred someti-
tive bread.

One of the surveys seed for nerehendieing reports had to do with pur-
chasing habits on certain fruits and vegetables. msuomaires were
mailed to the 150 neubers of the Food foundation‘s homemakers' panel.9
The questionnaire contained e list of 35 fruits and vegetables. and the
mm were eted to check each itel as to diether it was purdlaeed often,
sometimes. rarely or never. the inferneticn the obtained was valuable
to promos nerfiendisers in deter-lining relative popularity of various
items.

Before he Kroger manufacturing division decided to package the one-
pcund box of Kroger Crackers in four individually wrepped cellophane unite.
a survey was conducted to determine customer acceptefce of this type of
packaging. be survey showed that 76 percent of the women interviewed
preferred that type of packaging. The packaging method was ten adopted
with considerable success.

to detonate the niforeitr or leek of it among various Kroger

branches on the sthect of supplenental displays. the department survqed

 

9 See page 1“.

31
seven branches on the subject. his opinions of store nenegers. district
homers. and merchandisers were included in the survey.

A report which was a by-product of other studies consi dered the
ratios of shelf stock to sales on tomato Juice. peas. gelatine and pork
and beans. The data was based on nine metropolitan stores. The report
covered: average shelf stock as a percentage of weekly sales for each
connodity group: range of this percentage for each brand: shelf stock of
Kroger label merchandise as percentage of weekly sales: and s comparison
of the percentages of Kroger label sales and shelf stock. The item which
was met out of line was Kroger gelatin. in whim the m1: stock was 502
percent of the average week's sales. .

Of the two secondary or outside morts that had to do with latched:-
dlsing. one was the latest Du Pont shq on transparent packaging and in-
pulse purchases. while the other gave Department of Agriculture figures
on has gardens and the various items grown therein. The latter report
helped the merchandisers to estinste me market for seeds. while it also
gave the produce merchandisers ems idea of the produce items which would

have the greatest summer slurp as e. result of home gnrdens.

Prelim Reports
A premium report tries to estimate the customer response which any
proposed preeit- will elicit. There were four premium reports based on
the emerimentcl technique. A group of test and control stores were set
up. and the extra sales due to the influence of the premium offered in
the store were determined by subtracting the variation in the control

group froe the variation in the test group. These four tests had to do

with the following subjects! effect of e. salad tongs pro-it- on tube
tomato tonnage: effect of e cigarette lighter prelim on carton cigarette
sales: effect of plastic straws banded onto iced tee peokages: and effect
on iced tea sales of a proclaim of personalised iced tea. spoons. nr-pkins.
and coasters.

Of the 17 premium reports. 12 used the mail survey technique. A num-
ber of proposed premiums was broken down into pairs of two, end a form
printed which described and pictured each of the two. A coupon was
attached to this form which the recipient was asked to return if either
of the prenims was desired. A noninsl sun was charged for the pro-inns.
About four hundred of these forms were sent to people who had previously
written for Kroger premiums which were publicly offered. This was done
to secure a receptive audience and thus increase the percentage of returns.

The purpose of these surveys was not to discover the absolute pulling
power of the pro-inns. but the Wpozaulariv of the two. By process
of elimination. e. number of potential precious was finally narrowed until
only one remained. These preniuss are usually used to promote the sole
of one of the Kroger coffees. The process of pro-selection has done much
to increase the returns for premium that Kroger hes offered the public.
One test on preniuns was conducted by means of coupon analysis. Inexpen-
sive Jewelry was used as s premium to promote Kroger coffees. A different
post office box nmber was given in the sonic section eds. rotogrz vure
section. on the radio and on the coffee bogs themselves. By tabulatinp.
the returns to each box mber. some idea of the return from ezch media

was obtained. Since each brand and size of Kroger coffee was coded

'53
differently and a cougon from the coffee had to accompzmr each request.
these coupons were analyzed. by brand and. size. By comparing these fig-
urea with the figures on warehouse movement of the respective brands dur-
ing the offer. it w: a determined which brand of coffee was being purchased

to get the premium.

Rev Line Report.

or the twelve reporte en the abject of adopting m linen. four
were concerned with frozen neete. three with e housewares eection. and
the “inn with nagazinee. children's booke. celloDhane-Iranped to'el
eete. and e baby needs eection. The experinental technique was need in
ell e! theee teete. Iheeeite-e were placed on eele in eeleeted teet
eteree end the sales reunite of each item in the group were determined.
By carefully deter-inns cute-er acceptance of new producte in thie
manner before extending then to Imger'e two thoueend. etoree. costly
errore can often be prevented. '

Since all theee teete follow the eame general pattern. the frozen
meate tests in a good example. Because a lowotempernture caae in required
for frozen mate. theee reeulte were compared with eelee resulte for fro-
zen frnite end vegetablee which need the name type of can. thie parti—
cular teet laeted for quite a Ihile. eo prunes reports were «kitted
frequtlr. Sales for each itee. total eelee. eelee per linear foot.
and norm dollars were all calculated. The ratio of frozen neat ealee
to every hundred dollars 0! total etere eelee eae elee considered eig-
nificent. It is standard proceblre for photographs of the store dieplay

of the new line to be mbnitted in the body of the report. This type of

preeenteticn lakee the whole etndw more easily grasped by busy executives.

31s
Ouetoeer AtWorte

0f the reporte on customer attitndee and habite. eight were baeed on
we. Six of the eight were the immediate reeulte of enrveye condneted
with epecifie local probleee in nind. while two of theee reporte were not
baeed on epecifio eurveye, but gave ever-all cenclueicne en creee-ehoppin;
that had been compiled ae a by-prodnct of e nuber of ether mo.

0! the eix enmye need to eolve local problem. one wae conducted
within Kroger eteree. while the other five coneieted of interviewe made
in ereae amount to Kroger eteree.

no eurvey conducted with Kroger eteree wae nade in eight repre-
eentative Kroger stereo in cinoinnati. During one week 9,533 interviewe
were undo in theee eight etcree. hie wae approximately one-third of
the total labor of choppere in theee eteree during one week.

Irhie my. being confined to Kroger etoree, was to find out cer-
tain facte about Kroger customers. Theee were: 1) how far cuetomere
live fro. etere: 2) how often they ehep at that particular etere:

3) whether they chop at any other Kroger etere: 1%) neane of reaching the
"ore: 5) departmental purchaeee and total eele.

tour of the eurveye nade euteide fie eteree were nade by perecnel
interview. while one wae node by telephone. Typical of theee pereonal
interviews made outeide the etere ie the queetiennaire ehown in Figure 2.
which wee Iced in n my in the cincinneti eree. While thie queeticn-
neire ie not very long. it dcee reveal e mber of pertinent facte about
ehcppin; habite in the area and about the competitive poeition of varioue

chnine and independente. Yerioue breakdown can reveal the etrengthe and

35
“Good morning - We’re making a national food buying survey. and I'd

like you to help anewer e few einple qneetione. it will take only a
mmue.

1.

Do youbuy most of the food for your family? Yes“ No___
(1! “lo“. dieoontinne the interview.)

 

2. low my people do you buy food for?
3. Wheredoyonuuallyhymfiofymt
Fresh fruite and Heate Stz-ple
vegetable e groceriee

a. Store heme
b. Address
c. flow for
d. bby
‘4. Do you eonetinoe ( ) use a written shapping list?

usually ( )

alme ( )

never ( )
5. Which of the following etoreet (Cheek list of Kroger. A e P and

varioue other coupe titers)
:3. Have you chopped in? . ,
be fine friadlieet clerks?
I. In beet looking store?
5. Which etore has:
'1‘th finite and Meets Staple
Vegetable. groceries

e. Loweet prioee
b. Beet with
o. Largest variety
Gheeiflontimt
lane
iddreee ,
Eetileted Age
Interviewer

Fig. 2. theeticnnaire need in Cincinnati eurvey

36
weekneeses of each department. The infernaticn unearthed by such a our-
voy is often quite surprising to branch personnel.

1110 usual “bar of intorwiewe nade in thin type of local survey is
about 125. although 355 were node in one case. Since such etndiee are
rather routine. the merchandising roeoaroh departnent hae tuned arch of
this type of Operation ever to the various branch“.

Theee surveys are ueually resorted to when the Kroger position in a
certain area ie not as strong at it it felt that it ehould be. of course.
in the houee-to-houee intervieve Kroger is never identified as the sponsor
of the survey. leet biae be introduced.

‘lhe may in which telephone interviews were need wae Just one part
of a very extenaivo study that was nade of the Kroger position in a specif-
ic town of about 125.000 people. The Kroger operation in thie town wae
below par. despite the fact that the phyeioal eetup was capable of doing
a next” Job. The tack of the nerohendising research depart-out wae to
note a thorough etudy of the “motion in the town. analysing reasons
behind the poor Kroger showing. and to note recommendations for improving
the competitive poeitien.

A four-point etudy of the problen was nade. Firstly. general office
and branch personnel were motioned to get their thinking on the problen.
secondly. a thorough study of the narket and the Kroger position was node
by onvthe-epot observation and probing. Thirdly. the actual dollar vel-
.e of purchaeee by s. nnber of wenen in thin town was noaenred - where.
when. and by when. Fourthly. women in this town were interviewed and
acted their opinione as to the relative merits of Kroger and ite competi-

b0".

37

The report gave all the baeic data about the town! smmhiocl.
inductricl. ethnological. and population (note. In addition. c hictori-
eal cannery of the truer pocition in the teen wee given. he tetel
n-ber of food ctoree. brohnn dam on to indepth and each meoifie
chain. vac nlco givu.

he hictorioal peeitien e! Kroger in thie tewn no not favorable.
'more had been e etrong anti-Min feeling in the teen during the 30'e.
and Kroger had had an interior phycical plant. Kroger left the town en-
tirely in 1910. Kroger returned to the teen in 19146 and began balding
nee etcrce. and at the tine of the etndy had five modern eterec.

'l'eigahone interviewing vac need in thie cnrvey eo that a large amber
cf interviewc could be obtained quiddy and at a relatively low eoet. A
further advantage in the nee of the telephone was its ability to seamed
the interviewc in varionc centionc a! the city. Your interviews each
were nade with 550 ram over an eight-day period. 3.31M chopping tripe
end a total expenditure of $10,101.28 were involved. lanes of respon-
dentc were picked at randon tron the eiv telephone directory.

he curly ehoced that onlyl‘lpcrcent ‘of the vonenhadbeu inc
truer etere in n typical week. while 58 percent hadn't been in recently
and 25 percent had never been in. Selee were broken deen by each etere.
and revealed that Kroger hed only eevcn percent of the bneinece. tile the
independente had 50 percent. and three other mine Qlit '43 percent of
the boninecc. he purchacee eere broken down into departunte. and each
chain vac compared on thic beeic. The average eale per vicit. neane of
reaching the etore. and type of dropper (i.c. nan. wonen. couple. child)

vere elco revealed from a breakdown of thin information.

38

A. detailed breakdown of the reasons for chopping in a certain 'etore
chewed the cute-ere pat naJor .phaeic on price and products. on which
Kroger had the peoreet rating. Kroger'e etrongeet rating was on appear-
once. The fact that the other mm did e. better sales Job than Kroger
cecned to indicate mat Kroger'c .phaoie was in the wrong place.

“hen the respondente were aekcd to compare Kroger with one or more
of the other chaine. 15 percent of the woncn rated Kroger as good an or
better ten the other ohainc. Yet. only 17 percent of the ween dropped
at Kroger during the etnw. Habit. then. wae probably a etrong factor
that Kroger had to overcome in gaining onetmere.

rho various reasons for chopping each cpecifie etcre were but.
don by eterc. he respondente were nice ated at the end of the tect
why th' didn't drop at Kroger eterec. Theee replice were broken doen
by eection of town and by reaeon. Reason for neat patronage were aloe
deternined in the corny. Verione other breakdown and factorc included
the following! percentage of respondente having home delivery for: milk,
baked goode. and produce: percentage having frozen food lockers: ratio of
hone ownere and auto ownere: percentage having food store charge accounts:
percentage mm; use of grocery etore delivery: size of family.

For additional light on the problem. prices of competitors were
checked againet Kroger prieec. Kroger prices were definitely in line at
the tine of this etndy. being about eqml to the lowest priced competitor.
leecver. eight nonthe prior to this tine a price study showed Kroner eon-
pared poorly with ite coupetitore en price. Although Kroger had improved
ite price position in the eight-loath period. it eeened likely that may

39
onetmere had decided that Kroger was a bit high on prices eight monthe

before and hadn't been beck to find out that the price had been dr-nged.

To round out the stub. a comparison one node of Kroger advertising
and competitore' advertising. An oneheie of newspaper lineage for 1919,
month by rail. showed that Kroger wee fourth men; the four dieine in
lineage. and fourth in readership. Readership on the previous week's
advertiemt was checked and race were asked to express opinions as to
which dinin had the beet boys. Only 6 percent thMt Kroger bed the
belt hm.

Since Kroger need radio advertising in this area, a, etud! of radio
listening bbite was also made. of the four stations eveilable for after-
noon listening. the station carrying Kroger programs rated fourth in
lietming. It wee also deter-ined that only about 2 percent of the wouen
in this town were lietenere to the Kroger radio show.

The general theme of the conelneicne to this report wee that. although
Kroger had some bed pointe in thie town. there was no predominance of
thinge wrozg with Kroger. There wee simply a lack of things different
about Imer which would convince women to break their long established
chopping habits and cone to Kroger etoree. x

In the period of time since this report was eubnitted, Kroger has
made a considerably better chewing in this city. Although it would be
premtnone to attribute all of thie increase to the ectivitiee of the
merchandising research departient. the focusing of attention on week
points and better appreciation of the over-e11 problems by branch per- .
eonnel which resulted from file study were inportnnt frctore in the

immed Show/inge

ho

to no rationed earlier in thio notion. two of tho reports on duo-
tenor attitudoo and ohoppilc hatito woro not haood oi opooifio arms.
but had hoon oonpiiod at a hy-produt of a other of othor mayo. Tho
fir-t of thooo otudioo gavo a broad roport on tomato for inoroaood oaioo.
“anon Choppers. tho report laid. loll into throo groupfl thooo who My
ohoot o1]. thoir grooorioo at Krogor: thooo rho tw oono ot Kroger and
om with competitors: thooo do I. nono of thoir food ooodo fro- Kroger.
loan of unit; to ouch of thooo throo groupo wore ooggeotod.

'hiio thio report no rather genoroi. it did 0. good Job of analysing
tho prohion and otating it in oloar. oharp tor-o. In tho darn-day prot-
iono of tho hoinooo. tho ovorboli poropoctivo con oaoily be overlooked.
but ouch a report holpo to keep tho IaJor oonoidorotiono in rind. Tho
oooond of tho-o ho reporto val qhito oililar to tho ono Joot nation“
lino it treated loans of oombating moo-ohoppihc.

Although routino oaloo mlyoio io ontoido the ooopo of thin depart-
Iolt. occaoiamally it dooo do thio typo of work. Ono ouch report pro- ’
outed truth in motoaor out and avorago oalo for tho variouo periodo
of the roar. 1'hio report hroko don oooh of tho oompoq’o {in divioiono
old 25 branches into main per Itoro por wool: and onrago oolo por trano-
ootioo.

to meadow report on mtoaor ottitndoo and hobito woo o reprint
of o opoooh given at o trado duration on tho “Moot of («do onto-or
poohohfl. Thoro van a (root Goal of “food for thought' in tho opoeoh
ond it no oidoiy oimlotod throughout tho «.an.

’41
fzdrertieing Reports

The advertising report based on a mvcy was conducted, in Detroit to
determine whether the prominent featuring of the Betw Croeker none at
the top of the weekly Kroger advertisement got :1 higher readership urn
normally could he expected. The survey was made on the do: after the ad-
vertioement appeared in the Detroit £333. The interviews were spree“
over various parts of the city, and. each area surveyed was available to a
Kroger store and. at least two oometitore. A total of 908 women were
interviewed.

Prat undies he? indie? ted that a larger percentogo of a store's
regular customers would mad its advertisements thrn would non-customers.
The qmrtion of this test was: whether or not the women who did not ordi-
narily shop at Kroger read this advertisement. featuring the national
brand tie-in, and to what evtent. In order to be sure that all the re-
spondents were not Kroger shoppers, each was asked the store where she
bought most of her neat. groceries. and produce.

The respondents were shown actual copies of the newspaper. The
housewives were asked to go through the paper, if they had read it. and
indicate which advertieuente they had read, and whidx parts of the food
etore advertising they recalled. reading. of the women hxterviewed, 337
(37.1 percent) said they had seen the paper. Since this number was the
maxim readership, the percentages given were orpreeeed as the rr-tio of
renders of the advertisements to readers of the paper.

This particulu editiom of the paper contained six full-page food

store advertisements. Each of these we divided into nine sections, and

1p.
the uspondent was asked which sections iru‘: been reed. Thus, for total
reader-imnesions the number of sections in er-ch advertisement (nine)
times the number of readers of the paper (337) grve a total of 3,633
possible maximum re: tier-impressions, which would be the one-hundred per-
cent figure. This sectional breakdown of readership is usually not avail-
able for grocery price advertising.

l’he figures were broken down to reveal cross-readership. i.e. the
number of Kroger shoppers reading A 6: P advertising. the amber of wrigley
choppers reading Kroger advertising. at cetere. The test showed a much
higher percentage of competitors' shoppers teadling this Kroger adver-
tisement than vice versa.

The average readership for the six full-page edvorti oersents was 36
percent. while the Kroger advertisement had the hzgheot readership - U9
percent. Kroger also had a more thorough reading by notions lien any of
the other advertisements. Similar tests in Chicago verified the results
of this test. indicating the ottention - getting; value of a. national brand.

A very extensive emerimentel test was conducted to determine various
facts about the effectiveness of Kroger's radio advertieing. The test
was designed to answer two questions: 1) can the sale of eggs be in-
creased by advertising then on a serial drama without the lose of erlcs
on breed. the previously advertised iterfix end 2) ‘i-Iill the use of spot
radio (individual promotions of a variety of products) be more effective
than a long-term serial drama program (promoting permanently a. single
product)?

The test lasted one year and covered four branches. The test was

actually conducted in two phone. One was in the hedieon and Grend R- pids

1*3
branches where the "Mary Foster” chow (advertising Kroger Broad) was
canceled. and spot announcements were substituted: the other $1.23 in the
Charleston and Kemphis branches when: the "Mary Foster" Show were confined.
but egg commercials replaced. the breed comma..-ciele.

- 'Eho test group of stores consisted of those exposed to radio (whether
it be aerial drum or spot announcements). and the control group consiltod
of those stores not emceed to radio stations that carried. the ”13an
Footer" chow. The selection of stores in each group was made on the basis
of the (Shares of penetration enjoyed by the station carrying the program
in question, the test stores being those in counties with the greatest
degree of station listening. and the control stores being those in counties
with little or no station listening. The criterion on which the tent and
control stores were selected was the Kroger Radio Survey which reports

by county the re lntive position of the Various statims in respect to
other stations in amount of listening.

For each of the itens advertised there was the problem of determin-
ing the offset of this navel-tine; on the sales of the advertised product
in the two groups of stores (test and control) before. enring. and after
the prcnction.

Because radio station coverage patterns do not follow the Kroger
branch area limits. not all the stores in the four test branches were
exposed to the test advertising. Therefore. there were no inter-branch
comparisons. Store displays were uniform throughout each brawls. and so
would. not be an added variable which Ionld affect oitlmr the test or con-
trol group. Sales plans and newspaper advertising were also unites!

throughout each cpsoific branch. so there was no variable in that respect.

uh

The spot radio test, cohaacted in two northern trance. called for
canceling fine bread show and substituting twenty spot announcements a
week over the station that for-erly carried the breed show. Each of the
specific itene wee featured in spot enhancements for a period of either
two or {on weeks. he itele thus advertised vcre: Kroger Pet-m. Kroger
corn. Kroger Fruit Cocktail. Kroger Peaches and Kroner Fruit Cake.

is previous studies had share that competitive brands: often less
salee to the advertised brand. sales for competitive brands were obtained
for siniler periods. ' his shoved shether sales were serelr shifted free
one brand to the advertised trend or whether additional sales were stifi-
lated.

Since the Kroger station in hphis had some degree of coverage in
each county in which Kroger operates in “let branch. the criterion for
deter-icing tent and control stores ran the degree of county coverage by
this stat-1m. The teet group res composed of sixty stores in counties in
vhioh this station had the greatest degree of penetration. and the con-
trol group we: composed of 26 stereo in counties in which the station had
little or no coverage. Isither of the groups were emosed to m coverage
free other stations carrying the “Hart Foster” breed advertising. Egg
advertising vac the only apparent variable between the two groups. The
correseelding periods of the previous year were used as bases for oes-
pering bread and egg tonnage. The same procedure we used in the
Charleston test.

Included in the final report were date!

1) showing the relative effect on bread sales shen radio serial
advertising is removed.

“5
2) concerning mot advertising:
a. the effectiveness of a two-week program versus a four-week
program of spots.
t. relative effect of spot mmnte on total cellar store
8810's

3) cmcerning serial drama advertising:

a. the relative effect of serial drama carrying egg advertisinx
on total dollar sales.

it) inportant in the application of the most effective type of radio
merchandising.

e. relative effectiveness of various prodmts.
h. relative effect on the product group from advertieim: one
product. (Kroger Peas advertised - effect on normative
c. :fitive effect on another product free advertising related
punt. (Kroner Peas advertised «- effect on Kroner Corn).
In order to measure accurately he effectiveness of the advertising.
n statistical approach was required. The first computation was one that
removed he store-sine variable. Br computing a ratio (test sales divided
by base sales). fie relative increase or decrease for each store was seen.
bus. the mesa. sf sales was not a confouding factor. In marine
the ratios of increase or decrease. the nain concen was to deter-ins
whether the eelnn effect (variations of increases and decreases of stores
within each group - test and control) would be the same in each of the
column (the same inter-action in both groups). If significant inter-
actions (more increases or decreases in one of the groups than in the
other) were fund. and if it were of the nature of a sales increase in
the test stores. the increase due to advertising could be estinated.
he fits. secondary reports that were concerned vith advertising: were
reports on the ratings of truer advertising by the various national ser-

vices. lieleen for television ratings and Starch readership ratings for

h6
Kroger newspaper advertising. Such highly temical and costly services
as thus are best perforned by national syndicates. since the merchandis-
ing research depart-eet of the Kroger Comany is not equipped technically
or financially. to carry out such operations.

Reports on Comtiti-

Since he grocery business is one of the nest conxpstitive in herica.
it 1. new important to know what competitors are song at .11 tines.
One report on competition was a enrvey cf Kroger branches to find out
that»: various local cometitors had my.“ one-half sent here on cash
registers. Each branch was elu asked whether it thought that Kroger
would gain an advantage over competition hr nsing uh here.

An inpertent report on competition is the camel company wide price
cheek. In each of the company's 25 trenches. free two to four local coe-
petitcl's m meshed for 9a.... A rather large moon- of items are
cheded for price comparison. Each 13er is itemized separately hr each
local cometitcr. and the n-her' cf itens in each cmmoditv group is
listed according to whether the Kroger price isms same as. higher than,
or lower tan competition.

he reports were based on the sensational Eavey Super Harhet at
Anderson. Indiana. The first report covered the opening of the store.
it gave an account of the pronotional activities that ecccnpanied the
opening and con-ented’on the departments and fixtures. Pictures were
included in the report. The second report was one year later and dos-
cribed the Men fiat had taken place in tin interim It was all

w
accompanied by a price check of the store as compared to the Kruger store
in Anders“.

has first of the semndary reports on the abject of competition gave
the results of the biennial survey by mam-arenas on the various
leading food chains. This survey affords a good rat-detect: by which to
nessnre results since various significant breakdowns are-ads in this re-
port. The n-her of stores. percentage of self—service stores. sales per'
etcre. nutter of cities and counties in thick the chain operates. percentaae
of total food business each chain has in “use counties. denartnentsl
hreahdcu of tetal store sales. and advertising expenditures are all
listed in this report. be second such report gave the results of date
ec-piled ‘7 land 2mm mine on all combination grocer: sales. tcth
disin and independent. with interpretations.

The third secondary report on the sunset d sometiticn was some-
thing of e m mg. This very conprehensive report was based on
bakery nerdendising. has exhaustive thoroughness of the report is in
iteelf n good melt for e. equate filletile research deparbent since
it is rather nlihelr that a line executive would either have the tine or
take the the to -dertake a project of this nature. Although the data
were all obtained outside lie research denarhent of the Kroger comm.
it had to he gleaned free e ”or of different seems. and all the in-
formation was focused so as to hell solve profile-e particular to Kroger.

The question of how far Kroger should go in its baker! operations
(self-service. seni-self-eervice. or complete service) was a mtbr of some

controversy. To add sons light to the prchl-I. the nerchandising research

 

1+8
depart-ant determined what other fine had done end. else laid dam sens
hesio factors on succeseml bakery nerchandising.

In addition to a statement of the problen this report contained four
nain sections. The first gave a general emery on the field: the second,
hasio date on the tens; nae: the mird. the serious types of we!
narket bakery operations: and the fourfi. cese shdies of what competitors
had done.

The general summery section listed the location of the document.
nsrcheJising techniques. effect on other sales. types of display rnd
fixtures. personnel facts and customer haying hahite.

.- . he next section gave a review of the industry in the precedim: rear.
listing dollar sales. prefit figures. st. ester». Also included were the
proposed plans of wholesale takers. facts on the labor market. retail
hohrs' production plans. storage eels per hopper. and type of outlet
in shidi baked goods were Mt.

The third section took up the types of chain store super market
bakery inetallsticns. Included therein were the following! chain-opera-
ted habriee: leased concession: sale of outside heherys' merchandise:
service mus self-service: factor of Visibiliwl advantages of sell lo.
cation: personnel: and duties of o sslcmerson in a service depart-ant.

his fourth section listed case studies of ten of the leading chains
in the nerchnndising of 'teked goods and described the nature of their
operations. An appendix listed pertinent facts about hone halting habits.

’he preceding report and the other secondary reports serve to point

out that Iroger's nerchemising research department is constentlr perusing

ya

the trade press and related publications for things shidi it can pass
slug to interested executives. The {fictions of this depart-cut fell
into tee categories. It is. first of all. n deperhent that enalqzee
and interprets marketing infornaticn in terns of proposed decisions or
actions. his requires the use of one of the three techniques of rather--
in; urinary data or the use of secondary ecwoee. In addition to this.
it is e some of factual infer-nation in the reference librerr sense. It
gives feet snerers to spot questions from existing materials in either
published sources or many records. Actually. this department has a
vast find of unset-lint“ infatuation which has been gathered as a b!-
prcduct of other investigations. This vast fund probably contains high-
grade ore which can be profitably lined in the future as the need arises.

Reports on Promotions

As was stated previouslr. the promotions attempt to boost store
traffic. We such pronotionel test concerned an attempt to boost Kroger
sales in a ton shore sales sore rather low by distributing books with
five dollars' sorth of varied coupons. redeenable on]: at Kroger stores
in this ton. Stores in two nearby tonne. einilar in industrial and
emnolcgioal characteristics. vere used in the control group. The stores
in the control group vere also sinilar to fie test stores in both dollar
sales and customer count.

has poet-test period see quite inportant in this test since the
objective was to eccmplieh a sales increase on a Wbaeis. The
tetnl value of coupons redeemed was 96.881.75. The test stores enJoved

50

an increase in store traffic. both during and after the test. while the
control group had a loan in store traffic during: the sane periods.

has cost of the test see figured as follovst

coupons (production and distributiu) $3,600

Displa Nateriel 207

Ooupon Redemptin

Total Cost $8.60?
Less - “at Mount Beoeptu'edlo

Balance yet to recapture $.10?
0- this basis it took a 5.1 percent sales increase for the test group of
stores over a twenty-seek period to vrite of! the balance. This was fig-
ured a the basis that s 5.1 percent soles increase per seek would give
$211 nerhup dollars per week. This experimnt ie a good example of how
narrating research can carefully estimate the benefit of a promotional
salons.

A sinilar promotional experilent vas conducted to see the effect on
store trefficnnd total etore sales by fiferinz e perfue vrlue. said to
be worth $3.50, for ten oento. 1our test stores were used in the town.
shile five control stores are located in towns far enough away to be un-
effected by the newspaper advertisixg announcing the sale of the pert-e.
A separate advertisement was used to me the sale of the pert-e.
and it was linited to one to a oustmsr. lass displays of approximately
seven-hundred bottles of pert-e were set up in high traffic locations in
each of the four test stores. 1 baee period of five weeks. ismediately
preceding the test. vac calculated.

 

10 This was the profit on the m sales. figured at the usual
branch markup.

'51
Iinfirm the week of the perfume offer. the dollar volume of the teat
stores increased 2.3 percent over the base period. while the control
stores increased 0.2 percent during the some period. a net gr- in of 2.1
percent. The customer count in the test stores during the week of the
offer increased 14.2 pON‘b over the base. while the control group de-
ereased 0." percent during fie sane period. Sisilar results were evi-
dent during the post-test period «- evidence that a permanent increase

1194 N“ gained.

Technical Hoports

The two technical tests enter sore into the reels of science that
the usual work by the dwartxnut. one test was to determine whether
covering e refrigerated produce rack at night would keep the produce in
better shape than leaving the rack movered. This test was conducted
Jointly by the merchandising research deperment. Its Kroger road Founda-
tion and the Bussmnn Refrigeration company. Temperemre control and
relative hulidity were two {enters that entered into the fin =1 decision.

The second test had to do with cost and profit figures for a self-
service meat case. Time and motion shdies were conducted in this test.
The cost per pond of neat and cost per package wrapped were figured for
both material: and labor. The profit per nan-hour was also calculatedt
Teanieel research of this type is a bit out of the usual vork of he
nerohendising research dqaertuent. and usually comes within the scope
of the Food Foundation or the nerfiadising department concerned.

Miscellaneous

The niecellaneous report was the remit of a survey among store

59
nersonnel to determine employee readership of public relations folders
which had been issued by the company. only persons who hs-d been with
the comm for more than three months more interviewed. This was to
more certain that they had been iomd the folders. Photons-tic copies
of the folders were shown to each respondent. Each we seized: 1) if he
Ina-d received the folder: 2) if he had reed it: ‘5) if he remembered the
contents: and ’4) his opinion on whether or not the folders were worth-

while and dweld be continued.

Panel Operation

A very ambitious project now being carried on by the merchandising
roscerdi departnent is a consumer panel. consi sting of about nine-hundred
families in St. Louis. Dayton. and Atlanta. These three cities were
ohouen to give different geographical locations and on the basis of file
number of Kroger stores in the use. The panel we»: set up so that there
sonld be two groups in each town .. owners or! television sets (the test
group) and moss who did not have eats (to control group).

The purpose of the test is to deter-inc the effect. if any. which the
Kroger television show. “The Alan Young Show," sill have onthe food nur-
ohasixg habits of television set more. A four-seek bose period was
condmted during Amust of 1950 before the Kroner show rent on the 2211’.

To proflde for those, subsequent to the initial interview, who bought
television sets. e for more non-television set owners were selected. The
nine-hundred initial members of the panel was e figure set high enough to
silos for he calculated other of drop-ate. As can be seen fro- I'igure
. 3. the initial questionnaire was construeted so that am doubtful census

55
would be diooonraged from Joining the panel. The attempt was to alimimto
moat of the potential draw-onto 'boforo the panel was finally establidlod.

A umber of applied paydmlogical points can be oeon in tho amo-
tiomairo in Figaro 3. ’irot of all. the rewondont was shown Juot how
oaoy it is to fill out ono of tho oamio report formo. Then the french
fry outtor mo givon to ash tho porno: fool indobted and more willing: to
mtimo. Tho prospect of futuro gifts was held but as an incentive to
tho romadont.

A for: of in area ante: of gathering a sample was and. i.o. tho
intorviooor did not havo tho ultimto dioioo so to the "Want. Thio
hopo don hino. Il’hn intoniooor m told to go to o oortaio monitiod
iltoroootion and start walking in o certain “notion ololg o oortaio
oido of In otreot. n- iltorviooor woo alloood to otort at .tho firot
Ila-o. hot if o rospoodont ogrood to cooperato in tin pond. tho intor-
viooor had to okip tho next throo hhoo hetero intorviooing another Ira-an.

Th1. woo preferred to to quota vote.- of oatpling in which tho arm-
plo io oanotrootod oo that tho oignifionnt olooooto in tho total popula-
tioo oriot in tho omlo in tho ouo proportion no in tho totol nebula-
tioo Mina; otudiod. Tho onol affinity oith tho quota mtoo of oop-
ling io that foot that up-to-doto otatiotioo oo cart-do areas aro ooldoo
11731111310.

’ivo moo for iooono ooro 51m. rotor than tho ooro 113ml tin-0e.
Emori-oo hao ohm flat with throo grmroo tho oidflo mm to dimor-

tiomtoly how. hot oith fin pogo o Ioro nor-a1 diotributioo to
obtoilod.

5h

“Good Morning Udtornoon)’

“We're linking a food (mopping ourvoy here in and I’d like to
have you help no. It will take only o couple minutes of your time and
will he very useful to no.“

 

'Do do moot of the food toying for your family?”
(If 0, thank her and diooontiuo tho interview.)

”Have you bought any food today? (yeotordey?) loot wootoudU'

“could you oind helping a fill out thio iofmtia obout thot food
thawing mp"

N____GPE: Let the roopondent see you write in all tho {note about her most
recent trip. 1'hon oey.

"3o wteinly would emprooiete it if you'd help uo with this informatiu
for all me food-Wing tripe you and your family onlm din-1mgv the week.
You saw how little the it took to mark this one - even though it woo
your firot tine. now that you're need to it. boy will be easier and
quieter. We d like you to fill in this information and than nail it to
no enoh week - and we'll Ind you a prize for every four lists you re-
tor-n. 0! eouroo, we'll. take euro of the “outage. All you have to do
io fill in the intonation like we did Just, now .- then return it to no.
You don't even hove to write on the envelope; it will already have our
eddrooo printed on it. he gift will oloo to out by nail - ond you'll
roooive one for every four lioto you not end nhn.’

3.923! I: to respondent dooo not wont to cooperate. that hor end an-
continue the interview. PIOSIO member that thio in o penol: end
if oho see-no heoitent. oho probably would drop out anyway. F'ini.oh
interviowo only wit hooo houoowivoo to. you feel will eontiuo
to uni in wotly reporto. 1‘hon give french fry utter to hooo
interested.

If oho agrees to cooperate, oql

"'i'o need a littlo more intonation about your food and meals!
(1) To how many people do you oerve ladleT

Total people

ohildron under 12
Adulto _

 

 

1"1g 3. thootiounairo for setting on pnnel

55

(2) where do you molly i. m of wt

52019.3: 119995153:
’noh loato __ e T
3min and Vogototloo w no
Grourioo ‘

(3) ‘o there any opeoiel roooonohyyootuyooot ofyourmnrion
ot (etove were)? ~ A

 

 

 

A_._‘

"or fie firot gift - he no yell neoive after you retum four weekly
morto, you nay have your ohoioo of on: eet of kitchen truoheo or thio
oolorfol ougor and oroaoor eet. lo '11 ooil you whichever you want - el
ooon eo we got your fourth return. whioh one do you want no to send?”
xitaon 3mobo
sugar ll creoso- )

"o whet eddmos lhmld we lull it"

mom _ f mamas _
om, 2053f in . moan W

‘ Where are o eouplo ofior iiinco we need oouo Notation cal

(it) making of everyone in your family. about how any road-m
tripe ere node in e. week

How many of thooo tripe are node by walking to the "HIV...—
now many by driving the cor?“
3our new by too or other putlio trenoportetionTM

(5) What. brand of out do you many m7...
What other brando of oilk do you oomotioeo toy?

 

 

‘r ‘—v—

(6) What brand of tread a you finally toy? 7 _
'het omen- brondo of tread do you oometioeo kw?

 

Do in five" trend and puma delivered to your hone? to. T )
Io ) 3! T33. about how no io your wotly behory bill?

 

(7) Including your oilk and bakery oxpenooo. about how Iooh doeo
your family opal for food in on average week?

(3) In» brand of coffee to you evenly on?
'het other trade or ooffeo do you ooootinoo bu? .

 

rig. 3. Quootiuoairo for ootting up panel (continued)

(9)
(10)

(11)
(12)

(i3)%

(In)

IJo 9&0“ get a daily nowopaper? Yeo ( ) I“o ( )
. which paper1 A

 

Do you personally med grooo ado in the nowopaperT
lover ( ) Soootiooo ( ) ololly*( ) Aduay. ( )

'hooo grooery ed do you read noot often?

 

“hot other groooxy edo do you ooootioeo road?

Eu”! have a radio? Too ( ) Io ( )
3f 3 urine“ daytioo whit do syoo lioton to ooot oftu?
I’oytilo Quin ohowo~ w W eroiol .-

Dogmhave e tolevioion eet- Yea. ( 3 lo ( )
If how-amount» hovoyouhed17
'hue io your favorite of the regular mowo A

”Thanh for helping uo with thooo emotion: the iota-on tin will be very

uooful.’

huuuohuut(M)123h5 on Mu“
Ietiolated ’go'

Interviewerfi I A A

v. w.w—

 

ris. 3. Quoofl'unoiro for oottiog Io) panel (continued)

 

,. _-..

 

57
2he oaporviooro to oet up the panelo in the three towno remained
in then tom for e period of tree weeko after he nonhoro etertod
reporting. key eheobod the reporto oont in and. where were were erroro.
helped u. where to fill out the for-o correctly.

he ooeoud page or on. mun). interview to:- contained a wet me
of pertinent date about fie nonhero of the panel. Thie date. whu om-
plouentol 13y other reporto. givoo e good idea of the food purtha sing
hehito of mono volen.

rhe weekly reporting for. which io ohown in lliguro 1! io quite oilplo
to an out. 3t 11». m. m. woo. um. and hay nuance m
“ht. rhe doekliot udor the whet oootion lobe the proeooo very oil-
plo. Thio in io out to a poet oi'iioe to: outer which he no amount
moootioo with the Kroger Gel-pony.

‘ for- no later uhittod to the panel where on their tolovioiol
11-min; halite. To. moor. were loud to out. our favorite telec-
vioioo protrol. In addition. a fleekliot of twelve televioion ohowo
available in the one. including the trogerbopoooored progru. wee an
to pool like". They wore ookod to give Ito outer of tinoo during
he poet two vote that each of the lioted program was eon. Tolevioion
me" that are gooooored ky food Chain! operating in the area are olweye
inoluiod in the doekliot.

’0! every four votly wort! sent in. the lea-hero of the panel
receive on inexponoive gift. rMildly. chatty lettero elweyo econ-pony
fieoo gifto- 'hooo temmo holp to reduo the war of drop-onto.

loom of the urdondioing nooerda depart-no have contacted
thooe penol onshore who hove been negligent in moitting weekly roped-to.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

I
58
F000 STORE TRIPS
FOR WEEK BEGINNING, MONDAY -L__
WHEN? WHERE? WHO? WHAT? HOW
__ (JUST MARK AN"x”) PALIC}+?
LI)
LU
: m4
}— Q
mml do UCL
T—LLJ 33
*— —__1 0: U7 am
< 3m <t mo 0 m
J x< m t—u 0:0 Ll.‘
5 LL!— | DJ T—U QZ —
1+5‘Q 5"3fiém;m$
FOODSTORE ‘ . m one x E 0.x <o,m<z.mo , ;
—- FAMILY &J EEJ>iCLEJ _J L5 go or—ldmagg TU'I/xL t
DAY HOUR NAME ADDRESS MEMBER(S) d u<fi km E L) m>§ Ucbl E d :o o SPENT '
~-~ ~ ~ rm: E fr ‘
J ' '
«a + ~—-+— A— --+————+’——
I I i ?
ee_e _, E_ _ _ L . ! ’ E H ,._
. f
T __ -AAJe- , A A-
__E_r_____FD , -- _D_
eeeeeee he ___________ ___M___ ___ __ _ _ ML ____
"E — e .44» ————————————————— __ _ -- ___ __ __LT,_ - _— L - ___.
EL. _ _ _ ___ _ , 1 _ _ _“
*‘-“——— _-_ __ L _ h _ __ _ — ~ - 1F - i —<>— r E — —J ---~- ___—
k— fi~
k
AT THE END OF THE WEEK (PREFERRABLY SUNDAY). NANHZL,______“__

 

JUST FOLD. SEAL. & MAIL. NO POSTAGE NEEDED.
ADDRESS 2—..“_.-- 7,

 

TEL . #: ___ ___-

 

Fig. 4. Panel weekly reporting form

 

 

 

59
he usual result of such action in that the labor remo- fie reporting.

In addition to those excellent reporter: who ”main in the panel for
the entire test period. there will be other: who report for the base pe-
riod and part of the tact and then drop. here will also be some who
report for the base and intonittcnt periods during the operation of the
panel. Although these two group: my leave something to to docirod an
to the amber of reports omitted, Itill those reports which they did
nil-it are perfectly valid and legitimate conclusion. can be drawn there-
from.

In addition to the prilary intonation on the effect of Kroger tele—
vision advertising on customers. a not fund of other information on
food shopping habits in general will result from this project. Th1.
valuable information, obtained as a try-product. should he of consider-
able value in the future work of the merchandising research dopartnent
a: it analyzer and interprets the data of the field of food distribution
so that the Kroger Company can operate more efficiently and thus. in

turn. enable its customer. to ”1470 Better For Leco.‘

CHAPTER 7

are? e saw. mmmm

one of he leet art-3t educatee of auteur; reward: in the feed
fieir field ie step I. shop. xlameuoemtei of Beetee. ¥aeeadeeettmn
1his» comm operatee 85 eteree that did e. ”lane at about 52 sillion
- “1131'. in 195). Ito marketing research divieion coneiete of 1h full-
uu mun. °oneidering the an a: the com; m. to mm a large
dooorhneht.

This deparhnent'o activities are quite wide in ”we - much wider
than file activities of the xroger company's merchandising reeoorch dqmrt-
meat which confines itself to the eolution of merchandi sing problem.

The Stop & Shop marketing resort-ch division anherk'a on 911 mp renowhg
studio“
Isrket areas. the factor of cometiticn. selecting: and ewlurting

etcre locations. man-or lowing habite. eelee notentiale. setting

eeles quot". sales promotion. problems of pricing, movement of
col-edifice. product elilinetion or simplification of lines. market-
ing nceaibilitiee of new products, store dissolve end their effective-
noes, podtnging, operating costs, elimination of mate. store etondorde
and practices, urea-118113 of operatiue, problem of organization
end mpervieiea. and tuiaeee trade.12

stap ‘ M (toner): he's ae In Beacon Grocery Sterne 9011mm-
tien) eetatliehed a grating reeearet depart-eet in 1938 eh. the mom

firet toga: to Mild cup. markete. 8election of etore eitee and reor-

 

11 he firet part of thie chapter ie based on. 0. 013:1: ’houpeon.
, (Studiee in 3mine" Peliq. ‘o. 19)
n Yeti 'atieoal hdutriel ochre.“ hard. 1%).

12 'illien ‘pple‘teu, " Ivictim; Ieeo rah ’reini Prqm !
hr Veteran.“ in»). than“. 11:179. 3am». 1941. or

61
genieing the comeny'c attire we ta of die tribntioc on the smear morlrnt
princinle became the initial function of the deporhnent.

’1'!!! this beginning the some of he dune Ment'e work we soon
broadened, nanegemmt realised that the date getherod in cemrehensiwe
market studies could be tied to good advantage in solving may men-chen-
dising problems. The advertising end sales dope rtments began to use the
newly established department. The dope rtncnt'e activities econ went
beyond the field of marketing. the deperhent wee acted to study the
ouenieetinel structure on! the company and mound menses. The de-
partment also assisted in preparing a etcre policy menial.

Th. marketing research division is headed by the Director of
“ax-h ting Research and coordination who reports to the guersl changer.
Immediate supervision and direction of he staff. however. is delegated
to he “anger of “arkcting Research. The Director of flagitating Recesrch
and coordination is also on the executive council whia cakes ell conpeny
policies eter than those determined by the board of directors.

The orgenizction of the departlcnt 1! shut in I'ie'urc '5. The fourteen
where of the deport-eat are supplemented when needed by temorery field
and clerical helm The five analysts do nest of the work either as indi-
viduals or in teens, depending at the size of the problem. Two snecieliets,
one u leet mtdmndiling and the other on produce merchandising, work
with the nannger in handling more technical mttere in their respective
fieldi. ghilc these not are not trained nerkcting research analysts, they
are hidily drilled mecieliete in the marketing of these perishable pre-
hcte. The manger of he deport-Int coordinatee these gecieliete with
the analysts.

mom 0? W‘RKETING
RESEARCH AND OmIIATIG

 

 

 

 

 

533mm

 

 

 

 

 

MM]! 0

MARKET IHG BESS)!”

 

62

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

L I l 1
warm to > nurses . 1 mm um
Barnum (5) } mounzsnu *IPIMABDISIM'
; mu! mm
I
g
I 7 _L .'_ _ _
(3.31:. cmmm rmow 7|
smmwue mamm Inn» m
(2) lemon an: I
Ins 1mm

 

 

 

 

’“e 3e sup ‘ “Up ‘m‘m ”.08” a”! mu

 

63

While tin scope of work handled by he deparhent to broad. it doee
not .dertahs assign-ate in uses in whit it is not eonpetsnt. seeh es
inelrsnoe. varshonse leyont. et oeters. On occasions outside specialists
ere retained to supplenent the deparhent.

lonetiti'we Jobs of en noeennting or statistical nature ere only
hsndled by he dopartnent shore interpreteHon or ennlyeie is required.
The depertnent else renders assistance to other departments in planning
pressures end ferns and in developixg fellow-op controls.

Wbile In naJority of projects are initiated at the request sf sene-
ue outside the dope rtllent. eons proJeete do originate with the depart-
nut. 3mm on stfly :- begun. a rqaert is prepared assuming the pro-
eedere and purpose of be sort. the report else contains infer-stiu so
to do rill do the work. shsn it will he done. ad estinates the cost.
Sue n upset serves as a blueprint in m ereontion of on study.
Almond: the I’irslster of Mmuting Research and coordinati. is responsi-
ble to tin general meager for the dmerhsnt's work. the general neneger
hes delegated the authority to the director so flat. as a nutter e!
prsotiee. his Wet n the win of any certain projeot is final.

After an enslyst is given n portionler project. he lost carry it to
enpletiu. owes! to he prepare“. of the final report. I“an" end charts
are eifier done by the analyst or by eomeone else in the dennrtment who
is stings at such presentation. The renort is reviewed and edited by
he meager before it is typed. The Director of. Hnrketing Research end
coordinatim gives the wort a final review before it is reloaeed.

In addition to gathering and interpreting tin facts. the deperbent
also gives emlieit neondetius. Benorts are snbnitted to all key

 

6‘:

-n concerned with the IOJeet. “here a report is of ccmpanybw‘lde inter-
est. s11 nembers of the executive council receive a copy. (hits often.
ns merger or director of he deperhsnt supplements n written report
vith on oral presentation. neing vienel side to put over ”or pain“.

1he semi-teem is an setity stun the commute use has its sue
hdget. its budget, based on the anticipated ”seem progrss. is «to.
lished Jointly by the director. the general manager. and the vise-presi-
asnts. 'hile the basic met. covering the poresnent staff. is fairly
rigid. there is quite a at of latitude in other expenses since the merit
of em Job is given separate omsideratiu before it is undertaken.

.Dstenss cost-asmttng records are kept on every study. Ones e.

ncnth its department prepares n report that gives the status and progress
of studies. flue nan-hours expended. and costs. The gates-Al non-«gar
receives his report.

Eso]: research analyst is smected to been hinsslf abrenlt of develop-
nuts in net-lusting research teshniqnes. The library proarcs copies of
cnrrmt articles on mrhting resent-a. and each analyst Inst brief
several of moss each lent. ‘fter mess briefs ere nineographed. they
ere distributed soon; t1. research when of the staff.

’he Dir'eotoi' of llmarketing “Ceamh and 0cot-dinetion spat five years
doing narketing research sort for truse before «nine to stq) 4' shop.
ls heeded es aspartmt at In”: for three or theec five pm. rt.
Innsger cane directly m e Charity and worked his way up thrth
the depamts

1n he dqbtc-dey operatiu of The dqmrtnent the auger has com-
plete minority. ne issues ell instrutiats end supervises the work

_/

65
without interference by the director. The director hires all the perma-
nent staff nenbers. assias subJects for study by the depart-cut, approves
reports before release. and handles budgetary matters. He also acts as
adviser to the manager of the department on letters of marketing research
technique.

Personnel from this department are drawn from both within the compaw
and from outside. The department usually prefers young. intelligent
people with little previous training in narkcting research.

Stop a Shop has set up a special training program in marketing
research for war veterans. Four young non between the ages of 22 and 29
were selected as trainees. he training was so desiglcd to teach both
practice and theory. Ihe progran was designed to take three years.

There were four phases to the program! training through doing: salinars:
contact with professionals: and university courses.

Each trainee was required to subnit to his superior a daily report
on his activities of the previous day. Each was given a specific piece
of research and was to consult with his superior when necessary. In the
course of their practical training, the trainees would: collect internal

and external data: conduct marketing tests: and analyze the data and wntc

it reports containing conclusions and recommendations based thereon. Before

,X‘starting in the marketing research depart-cut. these veterans were given

some actual experience in company stores and warehouses.
.. Throughout the training prcgren. a ninety-limits seminar was held

each week with the Director of Marketing Research presiding over the

‘trainees. At first. each seminar session was addressed by an executive

66
of the campany who dieoussed the organization and activities of hie flower-t-
mnt. Later. the semimre were devoted to presenting and. dlscuesim- the
following'

major all-rent developnmte in the food distribution indue try: the
contente and character-1e tide of eeleoted trade and professional
Journals: maficeting mme neterialo; marketing roses-rel; tools and
technique" the nerite end ehortoolinge of verioue enrketing roeenroh
we: the history of mrketing research: marketing naeorch orgrn-
teatime: and major «treat develomte in file marketing; neenroh
nanB
1'he traineee took tune in preparing and presenting the tonioe die-
«seed at the lunar meetinge. M intervale. game’s sneakers from odom-
tion, moment. or industry were invited to address: the group. 1‘he
traineee were required to mil-it mporte based on each seminar mating.
Theee Vere read by the director who eonnentod on men and returned then.
Extra-curricular aotivitiee were eeoo'oraged by the many. The
trainoee were urged to ettad profeeoiual tastings of advertieing.
meeting. and ealee gmupe. written reports on all eneh enetinge were
required. A required curriculu- of abject: to be taken at night one eet
up for the trainees. Cool-lee in fine following fielde eet-e required'
etatietice. accounting. mates, sex-hung. and pmholog. The train-
on eleo ettnded 13“ com-en on the one of mucus lacunae.
Stop 3' Shop has. done mneting reeeamh in the field of operations -
e field in thick relatively little mrketing research vat he been dale.

one ad: et‘dy had to do I'll: to checkout problem.1h Despite the fact

13 E: p. 180.

1’3 Richard Seem. ”tum-owing 3mm:- munmet. operating 3ffioienoy.’
{madman 13’21F220- ”0"". 19”-

67
that lush lead teen eeid about the proble- iy vet-lone industry epokeenen.
the Stop a. Shop augment mu looted e basis for clear-out action.

“hen the“ problem one given to the Iorketing reeearoh depart-eet. it
no decided to find out how leet tile customer-e wt in the etore and
how em the res divided between topping and mum. Each ouetoler
wee landed 41 tile—Ierked eerd in entering the ewe. Thie card wee
mu tine-outed then he mete-er entered the oheehoet line. stop-
weteh ehliee were node to deter-in preoieely hov lag the notion
teek to me the eerehendiee. total he eele. eelleet to I" and
beg fie nemndiee.

Infernal“ wee eleo reeerded to Gov lie etore dqaerheete vieited.
aunt of eele and Inner e! eperetiog fleeting toefie et verieee periode
ef the day. ’rou thie date were deteniled fie cup... part ef each
uetoeer'e etere tile. on use a new. in en etore at any one
tile and he eelee value at any one time.

he following eooelneieee were derived free the our

1. fine required fer edding nerdeediee ehargee on the out: regi eter
eooounte for e relatively can pertien of total oheokout tile.

2. “my e! the quested eeleti me and lechenicel oontrivoneee de-

eiped to rehee only the the required for totaling eerdmndiee
«borne cannot metatially red-e checkout tile.

3. Peak chem! leede em: be handled by providing additional
electing equipmt em oeehiere. by reducing the functions of ale

oemiere, or iy providing additional pereonnel to eeeiet in
err-min: or eookieg eerdeedi «.15

0e to bade e! an etfly. extra. «to» leeee were added an
peeei‘tle. lee eteree ineleled extra Wt leeee eed eet efiedulee were

 

15 m3. 220

68
melted eo fiat a real: “or of uployeee were available to help in the
tenant etande during the periede at heavieet auteur truffle.

lay of the stop 0‘ M eteree are located in end around Detropolitan
Iona. In em. timely populated area rente are high. end a good lose-
tier ie extreeely important. 1hie chain. no a result. he done :9. ooneider-
mo aunt of reeeerfi on defining trading area. The prinoiplee eould
he applied to on other diein'e etue location jot-other16

sup ‘ ahop generally triee to get about 15 interview for every
theeeend dellere of atom eelee. In theee interview various pertinent
feote about no eutoeere are obtained. Boo-tony deeigned Ierk-eenee
eerde ere ted in the interviewing. 1’hie penite quiet tahnlo tien hy
III Mince. whilt! the eutoner ie “in daeeh'ed eat. the interviewer.
etetioued leer the eheekaet etend. oheervee md recorde the relieving feete'
the of day. eex of outoeer. deparhente topped in and total count of
eeleo

’h. the interviewer (wily a girl) greete the auto-er pleeeutl:
end eeh fie followim inferuflni none of reeohing the etere: fre-
m a etoee um: 1...»; or teen eeetoeer nu We as the eterex
_nl hue addreee.

‘eter. the eddreeeee ere plotted on e any up by the nerhting
reeeerd dqaerhent. coleeeutire radii. meeting fro- fie etere. ere
drawn at garter-lilo intervele. his. the etore'e trading area can be
determined. Being on inane ten. the onetoeer'e income statue can elee
to demo free the addreee. It u can he detenined Just how nooy

 

16 '1111. Amma- end 3ieherd spee . "How to l . A T a
AI'm." Shin Em in. 27'1‘49—168. ’mvf‘msl. ”me n he

59
people reside in each qoertemile zone. e yerdetooh for reaming etere

performance is available. thawing where the store's mtoeere live and
to court they epend. e per oapite ealee figure can he obtained for en.
eone. stioree o: oompetitore are also epotted on the mm to give a more
rounded picture of the eiteetin.

*he infer-Mien revealed free uh e em eentetreten don in
~11 a way ee to mart a large aunt of useful and intereeting date
ehut he netonere of e eertein etem. The date can he of value to e
Quin in deciding vhefier to op. additimel etoree in a ton where it
already has e etore. 1! thee in e nation of ten hat the etore ie hot
drawing metmere free. e not suit fight profitably he opened ll thet
eeetion. 0! Ito om:- hend. e chain light avoid the error of owning a
etere h on me whoee radiate are already shopping at one of ite
etoree. 1‘hie tedtnique can else to we! in mmetiog Ialee promotion
eeheeee. if e It‘d: ie made three er {our weeke after a promotional eel-
pekn. and the 'breakfioeh ehoee e large umber or! new enetouere. he eel-
peig hey he judged ”08ml.

Ae wee ”timed. in “113.0? 31, 8top 3 shop ie e. (in believer in
he use of controlled experimte. ”hie teehniqu tee teen teed with
eeeeeee ea noted prone-e ruins nun; mum of feed and
grocery predate and stop a. 8hop. rhie technique is emeeielly well
united to the prohlene confronting e anti-unit operation.

GEAPIRR VI
RESEARCH 31 0mm CHAINS

Satan-y Stores

safe-my stores. Incorporated. fie second lergeet food chain in the
country. operator 2,080 etoree that do an annual wine of 1.? billion
dollere. ’hie chain has Ind n eeparete marketing research department
einoe 19%. Prior to that time marketing research was eono by the col—
peny'e nova-thing agency.

The organisation of “to marketing research deparhent nay he seen
in 11mm 6. The manager of the norketing research departmt ie under
the wereieion of the msger of the advertising divieion who. in turn.
it remoneihle to one of the preeidmt'e adminietretive oasis tente. The
rotating research depot-bent consists of thme oeotione - ealee enolyeie.
field W, at! eoononio rent-em . eaeh of which ie headed by an
eerietont to be manager. The departlmt ie served by a staff of tyniete,
tnhnletore, end a cartographer. ”here are eight toll-time employees in
the dqmrhemt and three undred pert-tine investigators who are used. as
needed.

’hie department eonne pnhliehed mterlel end. after briefing perti-
nent no teriel, passes it elug to top mgenent for further consideration.
Ihe deperteent ie celled on to answer neny queetione on population and
eoneuption. While the deperhent uninteine lone eelee reeerde. ite verh
ie Ieihly mlytie. the enabling of theee figuree being dme by other
Math...

 

 

 

 

71

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

r____
I mean _I
moxsm I
I nxvxsxm |
. L_ _ _1 _ __1
mnon
worm
msmm
r ‘ r r 1
sun mm sun nuns arm mum
m sue rm nu.» ma Econom
was sums 233m
' I J _ ._II.____.|
m1 8T3 romances 0mm ravenous
rim arm I
| Assam |
o)
L_£__J

'13. 6. “mating ”loam dwartnut of Safeway Storee

7?.
Requests for research my core from any divieion of the company.

Occeeiomlly. the demz-tment will originate ite m etudioe. Preceding
the inception of any research. the advertising nonmet- nuet pace on the
propoeei reecarch and its coet eetimate. ”hilo the dcpertnent's work ie
scheduled by fine manager, me pmeidont'e adlinietretire neeietont medi-
atee any controversy over the priority of various projects. All reports:
ere writtm and oral reports are celdm given. Roommdntione are
finally incluied. and the department relies on top nnnagment to see that
these recommmdetione are put into practice.

1‘hmh of the original date are obtained throw-h the three-hundred
part-time investigators. The advertising agency is only used to perforl
renew-oh that is directly winted to the cmpany'e advertising progran,
such an motile research and. copy rerearch. Store mung-era. are not need in
gathering data.

The doparhent'e budget it based on the prerioue year'e experime
pine meter” tanks are anticipated in the caning year. We ie flexible,
however. and a epociel appropriation may be oh tainei on approval of the
edrertieing' manger.

Tb nemhcre of the department can both free gradmte echoole of
heineee did the regular uploylent whole. The twine). cometmoe
of file etaff it maintained by periodic etef f meeting, pertinent readings,
and netherdzip in various trade eeeooietione. The manager of this depart-
lent wee for-erly the marketing reward: mnoger of one of the cctpany'e
advertieing agenciee. eo he her bad experience insaf'ewgg'e problems are

well no lerketing reeeerdl tefore hie preeent Job.

73

Facmtly this degertment has conducted research to detemine the ooet
of handling coupons. It ea: felt met the one—amt eliomnee grmted by
”tincture” was inradeqmte. comprehensive studies showed thrt the out
we nearer two cent 5. On the basis of these. findings a number of menu-

facturere raised the budding fee to two cents.

Grand union

The Grand “lieu company operate. 295 stores that do an annual value
of 116 Iillion dollars." an. eomoeny no. a research department ma
eon-into of the depamt hood and three other Ice. ’0: demographic and
Itetiltioei help me depart-cat me the regular company union. The
depart-one 1- directly and». to a. President w u- ”detest.

1» mt of an depart-at 1- quite ammo. It do» my. ine-
tien mt. enmetitive India. «mm-u. audios. round on pm.—
tienei effort! and a great deal of went on new type. of em. operations.
1‘» inflame. the depart-m has nude IMiOI en the use of iced preduu
mm refrigerated preduee. beet nethede to price eta-e cane, pedteges,
accent pubic: and I'eeti-O-mant leading prone-e.

I'm. dean-heat in column nail end relie- 3 outside egneiee fro-
“. to tile. About he years age 0. negmeut engineering fin made an
caplet. ad! of office lethedo and meter fir: ewied store emanating

teeth ode.

I'ood Fair Stores

Food 5’91? Stores. Incomoreted. the eevcmth largest food chain in

 

ITAThie ie the sales ”1-0 for 19119.

   

7!;
the acute-y, operate. 113 .tere. lint did e value of 161! lillion dollar.
18“ ”at." Thin chain has the MM” .ele. per .tor. of any principal
chain in 91. food field - 1.3 niilion dollar. per .tere per year,‘ Th1.
coupeny has it. own research department. In addition to the director of
reeeerch more are he ennlyete end as clerk-trout. J"lee available are
panel. of trained pert-tin. interviewer. in noet of fine areas where the
colony operatee. Additienel clerical or office help is drawn from an
offic. pool as needed,

Th1. department he. conduted leny .tmlie. of may. and means to e‘fect
Operating .caeniee. sfietentiel improvement in etore coca-ether efficiency
resulted from inteneive concentration a e productivity copra-ch to pey-
roll analyeie and control. Thom .tndie. of trading ereee. chopping
habits, and related factor. in verion. l'ood i"eir communitie. nrovided
information of great vein. in improving operation. of .peeific moor mar-
ket., in mlneting prospective .tore location. and in developing more
effective .31.. pronetion technique. 0a.:- research aotivitie. have
included' co-preheneive mini. of commodity line. carried by he four
grocery warehouse” .tndicl cf nomadic. ncvnente by brand” W
of .elf-eervio. neat and delicateuen operation» and comparative eale.

mlyeie.

Aipha Beta Food lax-ket-

Alpha ’ete Foot “mete. Immense. on California chain of minor
nan-kc to. i. an intending one. in the field of marketing reeeareh. TM.
date he. 22 large eta... and. deepite the conneretively cell disc of
tb chain. neatly .etablidod e mrbting reeeerch denertnt.

 

18 ’hi. wee the fiocnl year ending ‘pril 29. 1950.

75
while to planning of the nerkcting research i. done by the deport-
neat, the actual field studies are usually made by outside agencies sit
she. the dqmrtnent is in close contact. The department does not do
routine statistical work unless analysis or interpretatiai is required.
In selecting a men to head this department. the company decided that
a an sith a badosronnd in Q. comsny would be preferable to an outside
rsoearsb todinician. It was felt that line executive. would have sore
faith in out s nan. 1'11. «many orprssssd on qualifications they
desired as follows'
as duonld have a working hodsdge of sarketing. monies.
.tetis tics. asthmatics. pqohology. sociology and occnuio geogra-
phy. He not also have one ability to write brief, easily understood
report. which can be acted men promptly. when the occasion arise.
at staff costings. he shnld be able to speak in a fox-com and clear
nanor. Anether requirement is a he- mlyticsl nind shied: can
separate fact from fiction and present an ubi seed objective vies
oven lanai at times it nay b. in Its for: of constructive criti-
cism. Obviously in addition to being a .slsasn and a diplomat. be

lost be able to romeot confidence. boomse out of bi. work is of a
confidential nature.l9

To out those requirements. a man who had been with In. company for
Mien years was selected.

The scope of the doperhut's work has been rather broad. Stunies
have been conducted a the follosing smut.i store location. company
organisation. quotas and budgets. prom. shrinkage. checkout procedure
ad equip-at. incentive plan. for store rnegouont, fern for annual .tecirw
holders report. company osoorohip vorme rental of fleet core. design of
produce ador and billing fan and pro“. inmtcry system. venvious nor-
chsndising and pronotienal sQeIsos are also tested by this department.

 

19 019115: 3, Edward, "Hos Rseem-ch Works for Us." BELLE item in.)
mm. 27'173. ’fimm 1951-

16
colonial Stores

“clonal Stores. xcommented» _a fifv-year eld socteasters food
retailing coupe”. operates around 310 food stere. in seven stat”. wit
a 199) velue'cf nearly 180 Iillicc dollars. This many has so inte-
grated staff depot-best for emu; reeearfi. bet; despite this let cf
fenal neegnitiu. m sf m mum is on. mm are carried an by
several differut staff departments in he field. of accounting. sales.
advertising nd public relations. 1’rends in distributiu efficiaey are
e100 “flied BMW by adninistrative aesietofi attached to on
staff deparhcnts concerned with warebauing and transportation. 1to...
mrhting infcrnatioc is regularly gathered for to us of eanagonest
altcsgb the responsibility rests with e Ides ef different nit»
rater tee in «as department.

This may rec-tly conducted a survey seong sole sine-tossed
"speed-t. u 16 key cities tre- Bissau-s. Virginia menu-o to Florida.
Ta. purpose of on new was to deter-in use of to feed emu; habits
of housewives '1th the territory in erder to appraise the ecumeny's
serdandising policies. Prefessiceel interviewers were «aged to con-
tact s selected couple of approximately 1 per-cut of all failies is the
cities uder stedy. Io dieclesese was led. cf the spa-ring fire. 1‘he
results were tabulated on W emu». 1m ma m- coders eqcimt.
however. to Job was twat.

In. lagtby questionnaire, rain. is reproduced in 11m 7. was a...
siped te deter-ice is cost pepsler store in a given eoemiw. cost pon-
nlar topping tile, effectiveness. of feed advertising. and a host of other
questions on Ierebsndieing, personnel and store conditions.

 

 

 

CITY
( ) Neighborhood finisher” fiddreea
a ___. s ___. o ______
lumber cf Perms in Household _
1. Do you do most of the food shopping for your family? Yes“ no...

‘. (I! answer to above is '30"
Who in your fenily does met of the feod shoppin? .

2. Please try to recall on what day. you topped for foods last week.
tb stores you hopped in and the type of foods you purchased in each.

 

 

 

 

 

 

 

 

 

w W ram Ems. Emma

“a. m “I. teen—s. nun—nee... W 4‘

Tm. e—e—e-e ___— e—I-e-e— censuses-selle- m _-
Tm' ensue—see unseen-n- m sue-ensues... W __ —-—-
1“. sues—I- III—III. M M W . n

3““. sun—- e—een-u -—-—-e m _

*. ”blah day last week did you lab is a slut of purchases?

lec.___3 Rem-J ‘ed.____,: The. s...___¢ ri.___; 3.t.___g 5n.__3
. by, did you sake. the largest “t of purchases on that day!

W w

3. In what store do you “117 late the largest “t of you feed
Mess! isle of Jtere ( )

 

 

A. How long have you been seizing the largest coat of your purchases
in that store?

3. If ye. have changed stone with the last year. is what store did
you provisosly some he largest ascent of your food purchases?
lies. of Store ( ) “a

fig. 7. Questionnaire and by °clcniel Stereo

0.. thy did you shengoLii . _
Oc-utst

h. I3o you recall seeing any of these advertise-eet. is your newspaper
last reds? (Show advertisuate)

to.“ Yes“. Yes...“ Yes____ Yes. ,_ 1......
A. I. there awthing yes particularly member free any of these ads?

 

 

3. Ads like these appear evenP week. ls more am one of the- that
you read acre regularly thn ethers?

_, lo Preference——
0, 'hy do you read it nor. regularly the: the store?

Get ideas for seal...“

Feature. low cut specials“

Lists large numbers of itas_____

has none suggestions or horn-ah» holpe__..,. __
Help. in making your shopping list.____

other reason.“

5. no you receive handbille or circular. from any food store. in your
neighborhood?

1423*“ 50...... Occasionally (Includes yes) ’

 

A. Boyce read at teem Kc
3. Do you twp at the store sending circular. to you? Yes“ Hq

 

counts!

6. Do yes lost at the advertising and price-posters on store window.
use. you are shopping? “I... ‘0...

43. Deyes. caustics. go into a ebre to lab. a purchase a. a renlt
of seeing it. window advertising?

I... Frequently Yes. Wesionelly 139......—

 

 

7. Do you. or do you not. feel that some stores are lower in price than
others? check me:
8one are lever man other..._____
All about th sue“...

‘0 arm-u...

11;. 1. ens-um. seed by colonial Sui-u (mums)

A. (If ansver to above is “some are lever flan ethers')

"hid: one. or two stores would you say are usually lowest?

 

 

3. Do you think this store is:

l.

2.

0

counts!

q

Lowest 33st cl mm item or lowest on m items in the
store? “hot as!

Invest on certain ite- ___... ”___...
Lowest on host itels ___... ___... ___...

 

No ouster ___... ___...
1s it lcvsct Just on week-cad special. or is it lesset ell
seek leug?
Lowest on IBM specials ___... “___...
lowest all wet lag “___...“
Ho answer ___... ___. ___-

. ihshatdoyounainlyhaeeyourcpiniee?

Advertising

Slapping Experience—___...
other”
no chaser

 

 

 

8. bag the stores you are acquainted sill, sud. in your opinion.
offers the following!

widest variety of items to choose fro-
lest Qsaliw_
lost convenient arrangonent for topping
lest quality meats
Lssest prices in seat.
Best quality of. fruits and vegetables
Levest prices in fruits end vegetables
3est quality of groceries
Lowest prices in groceries

. Host courteous or friendly .ployees
fleet convenient locatim
lost satisfactory Wt some

’15. To

HHIWHH
l

mum seed by oolissial Store. (cuties-d)

9.

10.

so
We is . flopping section where s enter of feed store. are located
near your hose. Rave yes gone outside tat area to by feed. is to
last at?
tee-___, 1...... Is- any “k

A. (I: seen:- to last queues is 'Iss') Inn

 

Do any of the stores you are acquainted with have s self-sends. seat

 

center where steaks. flops. roasts. etc. are pro-pahged?
'00....— he...”
A What is your opinion stout self-service nests?

31h...— Dislihem Don't care... No Answer...
“suction of head of fully__ '
col-sets:

rug. 7. Questionnaire use by Golccial Stores (continued)

 

81
his particular project was initiated through a conference of the
adlinistretdve vice-presidnt. controller. soles senager. advertising
Integer. pshlie relations see and a regreeeetatdve free tho concesy's
adv-films as“.

sswore]. ash confer.” were hold. wing which the strategy lid
details of tin survey were vested out. 1‘he advertising egney handled
ens see-sates of the survey. as the muss «pare-as st Oslensi
Stores tech ever on comm. phase sp- sesssps of on eelpleted
questioned”. whit were rolled in hy interns-ere.

Thisparticslar mnemmrthnesyether the ec-panyhad
eonduted in to past. a sore detailed nelysis retains to he done.
l'cr instance. it is planned to break do- the opinions by shopping sen-
ten is the larger cities and to capers to opinions with the dueity of
coverage; by cumin Stores and sometime.

o‘er “tithing stile! include Morison. of 00!!!ch reports,
M as sales end costs. w genrcphieel shit. with applicable statis-
tics free govern-t agencies and free swch pitlided sorbet inferential
u app-m 11?:an hm’ ht. “diammm
sagasisee. 3y eating s. eeqarieos es s couty—hy-cousty er city-trusty
basis. using disposable ices-e estiutes. ratio of food expenditure. by
salary breehets and other indicators. sons gas of porter-aces say be
deter-iced.

Withut the Israel creation of c mmting research dqertlcnt. each
sf to staff depart-mt. ultimo. its ssh research to inn-eve it. spore-
tins and he company's ever—ell porter-aces. The sale. deparhent. for

82
instance. kegs detailed statistics a the individual Mover rates
um me tree-thousand itus. This r-ais; history is an objective
narrating reflrd of retinal. regional. and private label brands. This
dual-hut sleo oondIets tests within the stores on deli and display
slightest. he man: does e eoneiderable mount of prise enacting
along so-petiters. selected groups of Stone in each dqaartnent are
defied in the etores of onetitors each seek. Supervisors and serene:-
disers needve s special fen es ehid to record e” Monetia.

Jessi Peed Stores

2-. Jewel fee Genes: operates 155 stores is end eroded Ohieege.
in... stores «a s vol-e e: no sillies dollars 1.» year. new
Jewel has so lateting researeb dsperhsst. line easestivee is the up
ionising. real estate and Quoting eestiees of the men: do sees
researsh.

8into all the Jewel mi» are is the semen»: Chloe‘s area.
he ones: is me to use mental: Is eessideretle spent er researeh
dose by others es this dual: pepslated area. he Chicago sevspapere.‘
partinlarly the 331m. have due quite a bit or! research on this area.
‘- repert put out by the 2m entitled "Your Bstail List.“ gave the
realts e! a siNde server of retail nits doing sore than ”has--
send dollars weekly. Th report listed the varioue stores ty types.
gave to value and lines of remedies earrisd. house and pepnh ti.
data are available for separate areas sithin the city. and Jose]. has used
these times is site eeleeties sad settle; soles quotas. A ens-er
panel. operated by to Ohissco 2i'ibusl is used by Jewel to ascertain
various shopping hbits d local resideste.

53
Pan Fruit Oman!

The Penn Fruit 00mm operates about 13 very large super Inmate ill
and around Philadelphia. A certain out of marks ting, research is done
h: emtivea since more is so aeparato dopartaent. the soapany has
tied a marketing resoara cg" for sole consumer audios on lax-hot pne-
tration and Manes of self-sere'ise neat deparhaats.

led Del 8terse

Red 0-1 3toree. Increment“. e1 iii-lemons. operates amt 175
stores doing as anneal value of about fifty sillin dollars. he organ-
isation he no separate mthetis; researfi deparhut. tech sort being
done at intervals by line euntives. As part e! a mussel survey of
food buying habits by the cutie all“ oonpasy. interviews were
neatly end—ted is 1led Gel three. After the data had been breh.
iate various eategsries. the Gertie “new made all the infer-etio-
available b Redowl. The infer-dies was very detailed, and east see
light ea ease of me problus facing the semen.

herisaa s‘teree

brim stores. is fourth largest food ehain is the sentry,
operates about 1.500 stores in its East that do about W sillion dollars
annually. Sb «:0me has no men; research dqartoent. 0: occa-
eioas outside researa anodes have tees used to eoataet seam-rs te
tied oat opisieae on mating stereo. he lies exeestivee Mt
soae sort of a sarketing research sat-re. eleh as store leoation. and:-
sie of entities. sales petestiale and 41mm.

81%
J. weiilczarten

J. Veingartea, Iaeorporated of Houston. foxes operates 25 extremely
large stores. The average store in this chain does an animal value of
about ten sillion dollars. rho company has as sarketiag research depart-
Ieat. Various departments udertake studies on their em. but thie is
not a .ified prograo and is only done as the need dictates. Ilike oompaw
has led atside research agencies. ht this has been infrequent,

Hatiual Tea comm
The National Tea Comany of Chieago operates 6146 stores that did a
101‘s of 315 Iillic bllare is 1950. ‘arhetixg research is done only
es s part-ties. intend basis h liae eneatives. he oompaay sees to
advantage is sarhst data provided by various sevspapers is its area.
this is espeaiaIIy tree ‘1 the chieago area share the min; and ether
. Papers provide saliut narrating taste and figures.

other Chaise

’irst latiosal Stereo. lsesrporatea. a in Regina chain of ever a
mu sbreo doing a value of 35k sillies my. Macy's. :5 Detroit
‘eil ed' md 25 large stores. and Vos's. a Califomia his of aromd
15 very large stores. are all sililar is that iv have no narrating
researoh dqartlests. his is set to say that they do so animating re-
seard. however. since a certain snout is indispensable in any food
dais. Inky stores. lusrperatod, a Balifernia chain of about 35 large
stereo. has no resisting research depart-at at present. but professes
Is inertia of setting a: snh a dqartsut is the near future. The

'5
sonny has mtly be. ”organised. and be sore i-diate operating
probl-e have taken preeeduse ever the establidsest or a sarheting
researeb warts-t.

CRAP??? “I
OMAEIZAIIW (I A HABKETIM RESEARCH DEW!!!

The preceding empters have been saisly devoted to ease studies of
has various food ohaiss have or have not used sarketing round. This
chapter will contain some ever-all statements on be organisation of a
sarbeting reoearoh departs-at. based largely on the oases cited previously.

Almmgh nest of the Motions d sarheting researoh as praotioed by
feed miss have been mentioned. it light be sell to nestles the findings
of the lational Industrial °mfsrenss hard is a study it oondnoted on
many pmstiees is narrating research. According to this renort. the

soot important functions of the sarketing research departments in retail

2° aslysie of sonsuser sarket: competitive condi-

trade were as follows!
tiess is sarbts: sales sethods er devises: osstoaer pretenses” rela-
tive distribution costs: estimating potential sales: analysis of potential
on sax-ht areas: analysis and interpretation of general Iorht data:
prioe strata-es: sales sofiods or distribstiea poliq: ”lie relations;

eeleetia of distributive weasel” and sales perronasse tests.

Separate Deparheat Verses Line Emotive
Before proceeding any further. it sight be vell to seasider vhother
a separate sarkoting research dcarhnt should be established. or
isother this sort can be handled es s part-tile basis by. n» executives.
0: eon-so, in sheet every sensors of any else a eertais ascent of
"aerating intonation ie oupiled. neurevcer. there are disadvantages in

5 alert . Howl’s}? E‘E’“ 8
{31‘ Rumbas; Poliq .son or e mi edema
5) e Po 90

51
having this done on a piecemeal basis by various operating executives
since fact finding is usually secondary and gate side-tracked. Korecver.
there is no coordination sf effort and the resulting mos-nation is often
not fully disseminated. There are special marketing research techniques
of shioh nost «diner: executives are not aware. The knowledge of poten-
tial sources of information is e modality in itself. as is the task of
presenting the results in a cmrchessihle tors and interpreting the eig-
. Iifioent points correctly.

It would appear, where marketing research is done by a line executive.
that magmas“ does not see the need for separating the measuring
function from the operating function - Inc which is seamed. fuse.
line executives neame their on results and diagnose. their on real:-
noeoes. file ie eomeshat cougar-able to having accmuntents wait their
on books. It is often very difficult for line executives to eoe their
prohlene with couple to sweetivity.

Hunting research is often done on a part-tine basis by someone is
the soles deparhmt. 1‘he mental outlook necessary for sales work is
hardly the ease as that required for Iarbting research work. Sales
execstives are often it” sotisistie .. that is their dew. this opti-
Iisl leads to .phesisi‘ strong points tile utilising weaknesses.

It sens preferable. theaters. to have a separate roasting re-
search doarhsnt. In setting up a lsrhtiog research depart-Int. the
fellesisc points fluid he kept in lisdt

1. select the head of the depart-est carefully.
a) Should have academic training in aarkeung. statistics.
scene-ice. and tuinese.
23 fluid be objective and. analytical.

Md have experience in sarketing research and either Isr-
chandising. selling or advertising.

.' love its deparhsst report to top mus-t and he tree te criti-
cise - strictly a stat: dyer-nest.
Set a long-range progras - little muse work.
Set a flexible budget on the basis of the vest to 'be done.
Require statements on purposes. setnods and ecsts at intervals.
“10! the head or the depart-set ts sit in on top emittees te
anticipate the men's problems.

7. Alleethsdireetertemendsuetieeisthetielta

N
,e

9‘? W

Size of Basement

it. therefore. a separate marketing. reaeerch Warmest to superior
to having me work done internally ‘3 line executives, the next question
is one of the eisc of the deparhent.

A large department,“ not necessary except in the care of a for
extremely large organisaticne. A reflecting research deparhent imald not
be very large or it will acquire regular. routine Jobs whidx lets it an
operating department. rather man a reeeerch departeent. lore-ever. a
large department so: be regarded as a 'frill' shieh rill he the first
depamm to to out shes profits ug‘.

i'he tern “department' new be wort-tats. Smaller cospaniee so: set
be able to afford a. 'fdmorbent' in the nasal sense of the vord. 3M
capanies right well emloy one good I. she understands fie field
thereuhls'ssd relren estside some fer-est of the sort.

The following footers govern the sire ef the deparhut!

l. 9h cuter of actual sarhetinc research motions it perterss.

2. I'lle amt st routine won: normed to the department.

3. The snout of statistical accounting done byte deparhut. i.e.

area or gecgrezehic distribution of sales. sales by item. etc.

h. he use at comm service deparhsnts such as etenegraphic and
computation pools and tahulating departments.

21 ‘E senor all. marketing Research In herican Industry. Part H.”
{mm}. e. 1m 1287. July. 19W.

59

5. The degree out mtnlizatigg of marketing research aotivitdee
prevail“; in the eempm. .

I01's important than the size of the department are the quelity of
the research and the mt am the deparhsnt we have divest eeesss
to top nascent. Obviously. e severally selected. adequetely soy.-
seted ensetivs is in e sets revenue pesitiee to gain the respsst st
mormsummmuusmmmu-mucw-
hearted beating of mags-eet. lexhtiec resend is so seed unless seed.
Olsse contest with top mt sees a. lee; sq in settle; reseaxeh put
into panties.

8n.- su ama- can. vseld pram; nu slim.“ of e 13;.
deparheet to be e seriees {hush}. drain. the eelstia seems to lie in
hevil‘ e .11. nasal-type marketing "seem deperhnt which relies
heavily a is services e! outside subting researsh emanate to de
test site schelset. aIshedasperhutwould»eaielyeoness'eed
vith detaining the neeeuhesededh fie company. estimabvoad ent-
lises ef ts set and interpreting the results after the outside agony
he smiled its desired woman. A depart-at ed this nature so!“
freely avail itself ei’ the eerviees e: gesielists ie sesh fields as ste-
tieties. ”staging and advertising.

when es outside ages. is used. these should ts eloee seosdinetiu
sith the may so thet the was: begins shers the eonpm leaves off.
Otersise. fie agency mid tell the ooepw Int it elssedy hove.

22 We: I1 db. “flitting Research in Justices Industry. Part 1.'
aluminium“. 11'353. April. 1931.

90
here is e preeedent is the us er en agensy a s fee basis in the

field of advertising. rev oelpanies on afford a. large depa rhent of
advertising medalists. The selntia is to use the services of an
econ". Me is e perelld sitIstifi in te marketing research field.
be outside reseerd as” can bring breed experience in the field to
teens se Its problems confronting any particular company.

b leis edmtagse e! n setside em ere ts breed experiuee
gained by my years in the field. the mania). faeilitiee. and en
ebJeetive visepeint. Outside «measles are at e disadvantage in that they
1m: en intimate tallied-iv sitb the seeditiens pee-liar to say one see-
pany. Oless cooper-sun sith tbs semen eee evsreele this draetack- ts
e eeeeidereble extent. however.

30s soap-lies per-it their edvertising “noise to de ell heir
subtle; reeeereh. It would se- te be preferable to ellss e‘ se
mwuunuueeamsm i-efletslreeneenedsitb am:-
using sieee that is its minty.

fills the larger Jobs sesld be bellied-b7 en outside auntie;
reseereb econ. the .ellsr Jobs “id be does viii- fie sum
there st ell peeeible.

Outside soureee e! Inter-sues
A. res musics earlier. see a: a» mum of a sax-hm; u.
searsl depart-eat is to set es s slearie‘ house for pertinent intonation
free outside eesrees. There ere new mess shit can finish vital
date to toss "aged in resisting rseeareh sort is is food ebeie field.
While it is quite “possible te “ea-ate ell the pessible outside

ssereee e! isles-stint tint reed neiee as: see is auntie; researeb.

91
an attempt sill be nade to list seas of he IIJOI' senses.

There are new prodnesrs ef nerdaandies sold in feed shain stores
that have nerheting researsh depart-sets. lansniens relationships bo-
tse. is nasketinc research deparhsnts sf the produce and the food
ehains can yield benefits ts bet groups. he interchange of inferential
betve. these tve groups on help both to solve their respestive preblus.
De Poet and Anon. for intense. have due sub in. the mung researeh
field ad have lads nest sf heir results available to retailers. Pre-
dassrs and retailers both have the sense goal of selling sore nerehen-
dise. ad eeoperatisn in enlisting ”seam is entually beneficial.

Various etere auditing services. sash as Nielsen and Industrial
We. desk the mes-at of urine items in dell etsres and furnish
fie «operating shaine sith infssnetisn a e “immune.

As was “tinned in ts earlier deptsre. nee; letrspeliten neve—
pqwsre furnish Iarhting data ‘1‘ is sf interest ts feed debs.
Inelnded n a... data "an be an». en! popmuae. insole. retail
sales. retail outlets. mapsr sdrsslatien and indie; arses. Sue sf
he letter papers sondIet pantry mun... panels. or stsre auditing
reports. Ieeel W sf Gee-sees as often reveal pertinent faets and
figures ebsnt the areas flew repres-t.

frets aeseeiatiens, e4. fie Aeerisen Heat Institute. the been
’00! ”inflation. the Intiml Assesistise of had Mu. to Bnper
Ismstlnetitnts. st esters. shile net narhetin; resent-t grows. often
supile infenetien am is sf huh interest to me doing herketing
researd set in he food itein field.

92

By far he largest miles of facts, figures, and statistics in
the vcrld is the United States Gevcrucnt. 0! nain interest to food
chains is the sort of the anrtnents of Geuuerce and Agriselture.

The Predictisn and lasting Aduinistratian sf ts Dspec-bent sf
Agriculture has done a considerable -ennt cf sex-h en the retailing nd
distribution sf fan profits. of particular interest to feed chains is
the vest done on precpetecsd preduse and self-service neat dqarhnte.

he Bureau sf the Cases of the Deparbsnt of census is 31:10!
fact finding and statistical agency with data se populaties. business.
industry end agriculture. he vast fnd sf ”Dustin gathered by this
dqarhslt is of vandals value to was in the field sf mm

research.

. Sue selleges now do sarketing ressersh which could be profitably
Iced w “its. 5“ mee- fienld be failiar to m in flee marketing
research field.

GWTER VIII
SM AND CONCLUSIONS

thdant to tho disc'sioh of Iarknting roeerrch work done by
various food chains vac is necessary prelininary chapter on the various
narhsting research technique. while it is admitted that the survey is
irreplcsebls for certain problsle. the controlled experilsnt. heretofore
rather neglected, seems to be ideally suited to help solve certain pro-
bless ocnfrenting food ‘dtains. Problue in packaging, displays. pro-
Iotiolis. and pricing, to none but e. for. seen: to be especially well allied
to the use of this technique.

Bxanplss sf hos both the W and erpsrinntel techniques are used
have been Wt out in the dismeim of research done by various
chains. ’

In he dissusin of is Kroger Coupeny. it was en. that researfl
is earrisdubyanubsrsf mun thatseupeny. with theuer-
chendisiu research deparhent being fie Iain nerketie‘ research body.

In his study of representative problsns of this department. various
applicatins of researfi vere illutrated. sone problcss are done in a
relatively short tine. Idaile others. concerned with basic company policy.
recurs a longer period of stdy.

fhe shdy of Stop 5 Shop of Boston shoved that uarheting research
is a continuous activity chi. is velded into the regular activities of
hat cups". The scope of probl-s hndlsd by he uarhetiug research
deparhut of Stop it Shop is quite broad. includiu‘ Qerstis; preblue.

9“
he moifio tefinique ted by Stop 5 fi‘ilop for plsttiug trading areas
was described.

0: the other stains sectioned. only Safeway Stores. Grand I'hioe,
reed Fair. and Alpha Beta food narrate have marketing research dcparunents.
'hile to our chains have done a certain ascent of record-Q. it vac
generally quite linitcd. being done on a part-tine beds by a key
executive.

A separate marketing research deparucnt gate full coordinatin of
effort and insemination of results. 31‘: a department is in a better
position to be familiar. sith special temiquae and potential sources of
intonation. however. to task of presenting results in a comprehensible
fore and inteareting significant points correctly can be done in n nere
effisi-lt name:- w a separate full—tine deparhaat. Line executives
«m in: the tilt. consume and specialised knew-hes necessary for
sand researdi. For these flaeons. a separate narhsting research is-
parhent is felt to be superior to having sch seek dens-infsnally U
n line executive.

lsssusa laould not be considered to be a prerogative snly of an;
caporatias. Realising that all" Quins have lilited ”gets. it is
felt int a hall anrut Ill. nehes us of fluids wise for the
largsrjobs isbest mitsdts Isirnesds. Modauhtidulddstsr-
nine the cenpany‘s research needs. nehs broad outlines of be work and
interpret the results as» an sutsids cg" has “.11.. the desired
infomtiu. 31sec contact sit out an agency, of course. is sssmtial.

lhe mm of the researd is be inertent dung. the selection
of herightnentehsadthedspertnentgeeealsegseyininsuringthe

95
quality of me department's work. I: research is to be put into practice.

the net-looting research wettest met have aoeese to top Imagmnt.
The head of me deparment should sit on top mugmt emitteee is
or“: to anticipate the company's research needs.

Since there are really only a for food anoine eith marketing rseeassh
dwartnmts. it is felt that fie at” chains could pmfi to“: expand in
this direotim. There ate three shalne sith m1 values ever 300
sillione dollars fiat do not have menting research Marten“. It is
felt om mesa mains, minimal). could mom by such a new.

It in m to naficeting reeeareh non to 'oell" teir services to the
chains. no can an adopt larketing ism merely to be considered
“progressive.“ ‘lanaaguent will 'be eager to adopt marketing resent-sh.
however. if thy can be shown how the: can profit fr. it. 3.4." reward
911m itself to lose sight of we pmfit motive as the real reason for
ite axioms. if the merchandising and sales departments fail to lake
practical me of the facts developed. «:1 it top augment allows either

of hose things to happen. then the me: ment is wasted.
' Ramon; research does not attempt to warp om funetion or manage-
ment in taking decisions. but presents ”augment with carefully «some
intonation to use as a basis for eating ecu-oer decisions. Mile market-
ing research data eannot ”pines send input. expel-ices. and goo!
cosmos sens. it fionld not be underestimted. Judges“ end emeritus
alone sill sores some of the tine. but not all the tile. The very Ian
decisions are seated in every instance. ’or the ten ieeisieee. facts
leet guide judgment end experieeee. For sen: muting men-e no

96
«urination of qualities inherent in any small 310er can possibly be as
good as research (irate. that scientifically describe a dilution.

Various pieces of legislation have constricted the Inning advantage
once hold 11y chains. All a. result. chi-ins have been forced to put more
«aphasia on sales. Chaim not realize that they from no pro—mum
right to any customer. ghee mt wage an oggreeeive battle to retain
their custaoere. Conditions amaze rapidly in the dynamic field of re-
tailing. h! conditions mange, proouote, nrlnn and distribution policies
must chmgo with them. 141::th research points the my for these

61811333. If given me opportmitv. marketing reward: non do the Job!

9 7
13 15331 {Ii 113an

Applet-u. Willi“. '5 Hunting RBI.“ frainiu Preston fer We:

Veterwm" WQLW 111179-181. October. 19%.
"Cmtrolled Emerimentation in Hubs-ting Research." M
u. mans-5“. “new. 195).

Applet“. William. and Meet 3. Bpeers. "he to lees-re s feeding
Area," M Stem 5'53, Grocery Edition, 27:1‘4'9—158. January. 1951.

lilaflcomiilp Albert Brennan editor £159. CQMQC - o
m’m lee rém le;per and refiners. 1&2. $179.

3w- lord- °- WMWW 5" '0!“ TI-
Boland Fuss; oww. 1950. 59-) pp

Cordell, Warren. "Sf-.13: "5:5 to faxwrnioe the Reliabiliw and Usefulness of
lee-tens; Bessel-eh.“ Emm' 5‘. 228836-3l. July 1. lghg.

Grier. Kim D... “To Incense Prefite fees Rascal-dz) W 31
mm. h0353-5“. from. 19"?-

2921 Die ibuti. 923L229. M? New Your! {like Twentieth Century Ema.
1 1e 3‘2 PP.

Giants a.. “Bee leseuen Weeks fee We." Mime“, Grocery
Edition, 21:173-188. l'ebrnary, 195).. .

Elder. Robert E.. “What Sales Imagasnt Expects In Room.“
mum 13:52.55, «My. 19%.

Eliseo. Peal 3.. 'l‘ive Steps for mung lube Rem,“ m!
in. 215.39%, September 13. 19%.

hit». Robert. W in W W In tax-1::
“finer-hill Bock coupon. .. l 9. 2 pp.

Gun, W h. ”Hoe to Get Marketing Rosanna Used at the Executive
teed," Print‘rs' Ink. 221351-65. needs: 12. 1’1.

“assets. Gear, 9st What Do fie Em Say" £32; W,
22213334 6‘4. July. 1950.

Hoiiingei‘ieli. Hymn 3.. and Albert 3. Blankenship, m mm
m ‘0' fit" ‘- ‘Olt. 19'4“!- 335 w.

Issuer st e)... '.uarhtie3 fieeeem in leet-teen lumen-’31,! J i.
. W! 1133353$s April. 19”,. Part II. 12325.37. Jun. 19 7.

98

Hobart. W I. mm. m m”. Ie' felt! the
Roland Pun m. 1950. 11 pp.

04:. Kerry 3.. "In: Every Genny Ml De Kuhn-g Renata."
Exam»: m. eases-so. 0...... an. 19“.

Fun: e. Gin-lee 3.. " er Area fer lean Renard.“ I“
M 11'3'35fi311. 19%- in; ‘

Reed. Vex-311 0.. 'The Bane en which Selling Plane leet lull."
m. 1.3, 22109-18. Oahu: 3).. 19131.

81-». law. WWW In roan Puma-flan. 1-0..
19%. he? pp.

Bpem. Bidet! 3‘... 'lqrflhg 3m: Hutu Operating mum:
{Miw 13:211-220. 00%». 19M.

nun-pm. 6. 61m ¥M§gflg 5mg!” mm. (sun.- in
lumen 5110;. as. 12 and 99" Pan 8 leaner: Experience.
Pat H: . I m . New York! Ilium].
lemma aurora» Board. 19 5. 1 ‘ . pp" 36 pp.

hue-Ant. 3. 1.. “Fence-fir” a lube Renard." 3
W 61:60-63. Sender 15. 1*? m

'e‘bber. “rem 1.. "be 30.0.: rad! A llama e! lode Evaluation."
museums. 98131.31. 00'0”. 19'“.

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