Evan Schuman's StorefrontBacktalk

Safeway, understandably, has a very different view. Safeway argues that it handles recalls “consistent with all legal/regulatory requirements” and that it issues news releases and posts information on its Web site. It also sometimes posts recall notices at POS devices in its stores and prints the information on POS receipts. To the point of the lawsuit, according to Teena Massingill, director of corporate public affairs for Safeway, the chain has sometimes “used Club Card data to make automated or personal telephone calls to customers regarding recalled products.”

Massingill added, however, that there are good reasons for the industry to not standardize on such CRM-based alerts.

“One size does not fit all. Indeed, less than 50 percent of all grocery retailers even have (loyalty CRM) programs, thus the ability to contact customers individually is not an industry norm,” she said.

Safeway’s E-mail also raised Safeway data consistency issues. “Shoppers are not required to provide contact information to obtain a Safeway ‘Club Card’ frequent shopper card. Neither do they purchase a membership, which requires them to supply personal contact information, as do shoppers of retail clubs like Costco,” Massingill said. “We consider the information/data that is available to determine how to best provide recall information to our customers.”

Similar lawsuits—on behalf of various consumers who purchased recalled products—have been going on for years. Back in 2004, it was Kroger’s turn to be sued. That lawsuit was eventually dismissed. But Kroger’s today uses its CRM database to alert customers to recalls, along with PriceChopper and, most notably, Costco, which has been pushing telephone outreach. The issue hasn’t been limited to grocery chains, either. Macy’s is entangled in the obligation-to-alert mess with the Los Angeles District Attorney’s Office and some lead-encrusted jewelry.

This has been a key issue for CSPI for years. The non-profit even launched a campaign—exactly one year ago—pointing to Costco as a retailer to emulate. In Wednesday’s lawsuit, CSPI referenced Kroger’s, Wal-Mart, Sam’s Club, Costco, Giant Food, Harris Tweet Food Markets, Wegmans Food Markets and ShopRite Supermarkets as chains that have now embraced alerting customers to recalls.

Safeway’s well-articulated consistency concerns notwithstanding, our take is that this should be an easy decision. Creating the ability to use E-mail, texting and other methods to stay in contact with loyalty customers should be done anyway. Once done, this type of recall outreach is relatively pain-free.

What benefits? First, consumers receiving such communications are likely to be extremely loyal for quite some time. Second, touting such capabilities is a wonderfully effective argument for getting a lot more customers to use their loyalty cards routinely. That also addresses Safeway’s data consistency concerns, as most customers will gladly volunteer accurate contact data if it means fast recall notifications. (That increase in loyalty card usage—and contact information accuracy—alone is worth the proverbial price of admission.)

Lastly, why not? If just one or two customers are hurt or killed—and there’s a good chance some might be children—because of the lack of notice, the legal liabilities (not to mention the PR disaster) could be devastating. So why risk it?