03/21/2008
MaineToday Media, Inc.
Hannaford Bros. supermarkets hasn't done enough to reassure and inform customers in the wake of the chain's credit and debit card security breach, experts in public relations and members of the food-industry media said Thursday.
The company should go beyond basic responses in the media and a Web site message, they say, with advertising and better in-store communications designed to calm fears and combat misinformation.
"They need to be putting something in every shopping bag," said Dennis Bailey, president of Savvy Inc. in Portland. "If you're not out there repeating your message, people are going to think the problem is worse than it is."
Bailey is widely known in Maine for advising corporate clients on media strategy. He and others say Hannaford isn't embracing one of the basic rules of crisis management: Communicate directly and clearly with customers so they're not misinformed by rumors or incomplete media reports. Failing to do that can undermine customer loyalty, a valuable and hard-won commodity in the grocery business.
A Hannaford spokeswoman responded Thursday to the criticism by saying that, because the supermarket doesn't collect customer names and information, speaking through the media is an effective way to communicate. The company also briefed its 27,000 workers, since many are on the front lines with customers.
"I'm sure we're making some imperfect decisions," said Carol Eleazer. "But it's an imperfect world, and we've never (confronted this problem) before. Our objective has been to best serve our customers."
Hannaford acknowledged Monday that federal authorities are investigating the theft of credit and debit card numbers from supermarkets in Maine and five other states. Up to 4.2 million card numbers were exposed to theft between early December and mid-March, the company said, and there have been reports of fraudulent activity on at least 1,800 cards. Hannaford said it first learned of the problem on Feb. 27.
Hannaford officials have declined to discuss details of the crime, citing the ongoing investigation. It has recommended that customers review their financial data and contact their banks and credit card companies with concerns.
On its Web site, the company also has a link to a letter from Ron Hodge, the chief executive officer, that includes a toll-free customer information number. The letter stops short of directly apologizing to customers. Bailey said an apology would be good practice, even though Hannaford also has been victimized.
Instead, Hodge writes, "... we sincerely regret any inconvenience this attack on our system may cause you." The letter also underestimates the now-obvious vulnerability of Hannaford's computers by writing: "We sincerely regret this intrusion into our systems, which we believe are among the strongest in the industry."
Hannaford is a subsidiary of Delhaize Group of Belgium. But its headquarters remains in Scarborough, and the 125-year old company has deep Maine roots. Hodge has been CEO since 2001, and a top executive since 1994.
Hodge should appear on a television commercial and talk personally to customers to apologize, explain what happened, and tell them what to do, Bailey said.
"They need to put a face on it," he said.
Hannaford's appearance of being less than "forthcoming" in media interviews also concerned Carol Morris of Morris Communications in Kennebunkport. Morris represented the Maine Department of Transportation when the old Waldo-Hancock Bridge was deemed too weak for big trucks.
Hannaford should remember that this event is taking place in a bad economy, she said, when people feel fragile about money. Placing a message from the CEO on a Web site isn't enough, she said. The Internet isn't a novelty now, but a supermarket shouldn't expect customers to stumble across critical communications there.
"If I were a customer, I'd be resentful of having to take the first step," she said.
Hodge's letter also is posted at the entrance to Hannaford's flagship store at Back Cove in Portland. It doesn't stand out among other visual clutter, however, and because it's taped to an automatic door, a customer has to make an effort to actually read it.
The parking lot was filled at lunch time Thursday, however, and at least two customers said the company was doing enough to get the word out.
Sue Till said she's using a credit card now, rather than a debit card, out of caution. Scott Enos said he read and watched media reports, and visited the Web site.
"What else is there to do?" he asked.
But Dan McGovern, publisher of Sustainable Food News in Portland, said his take on the media coverage is that Hannaford took a long time to acknowledge the problem and appeared to be "holding its cards close to the chest." It's an interesting contrast, McGovern said, because the company has cultivated so much positive media with its focus on healthy eating.
"Health builds customer loyalty," he said, "but it's even more so with the wallet."
Hannaford, Eleazer said, relied on internal advice and outside experts to shape its media strategy. In its direct dealing with customers, she said, the company is taking responsibility for its computer systems and apologizing for any problems caused by the attack. Feedback from outside experts is valuable, though, and is worth hearing, she said.
"We are constantly evaluating," Eleazer said. "If we feel the message isn't getting out, we'll dial it up."
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