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In the final weeks leading up to the International Dairy-Deli-Bakery Association's Dairy-Deli-Bake Seminar & Expo 2004 on June 6 to 8 in Washington, D.C. -- an event that promises to attract thousands of retail buyers, merchandisers, brokers, distributors, and manufacturers -- Progressive Grocer's Meg Major asked the Madison, Wis.-based trade organization's executive director, Carol Christison, to share her insights on a number of timely issues.
In this candid discussion the always forthcoming Christison, who began her leadership duties with the highly respected association in 1982, weighs in on what she perceives as the allied dairy, deli, and bakery industries' largest hurdles and most promising opportunities; fickle consumers; the principal challenges facing industry trade associations today; the complicated considerations of running a successful annual convention in high-security Washington, D.C.; and much more.
MM: Consolidation and the resulting time pressures placed on senior-level food industry executives have found many trade associations struggling with low member participation and uneventful trade shows. Yet IDDBA runs an extraordinarily well-attended and well-respected annual convention/trade show that seems to defy that trend. Why do you believe this to be so? Speaking of consolidation, how has it affected IDDBA's membership roster in recent years?
CC: If I were to mark one point in time that was pivotal to our growth, it would be way back, right after I started. That's when we hired the McKinsey Co. to evaluate our programs and provide us with strategies and tactics for future growth. We were a very small cheese and deli organization then, and the study cost was 10 percent of our annual budget. McKinsey identified 18 strategies as part of our long-range plan; we executed 17 of them. The 18th one was to publish our own trade magazine. Coming from a publishing background, I wouldn't have found this too difficult, but we decided it would dilute our focus and that it would jeopardize the relationship we had with the major trade publications. It just wasn't worth it. Our future lay in growing the association, and not in publishing a magazine.
The board used the McKinsey document as a plan, a vision, and a whip. Every time someone came up with a new idea or product, we'd look at the plan. If it wasn't there, it didn't get on our agenda. That vision and that focus from the early board are still in evidence today. It's been a dozen years since the last one of those early board members served, but their vision and mission are still as strong. After we finished the McKinsey plan, we created our own three-year revolving long-range plan. We're always in the first year of that plan, as we update it every year. Our internal plans must pass the S.M.A.R.T. test: They must be Specific, Measurable, Appropriate, Realistic, and Timely.
And when it comes to the last part of your question, consolidation, well, that's hit us as hard as it has every association that relies on voluntary membership. People don't have to pay dues. They do it because they're getting something of value in return for their money. That means that when budgets are tight, the dues are the first things to be cut.
We're fortunate in that our membership programs and our conference deliver real tangibles. As with any association, just maintaining membership numbers is incredible. Consolidation, mergers, companies going out of business, etc., all have a negative impact on our numbers. That means that before you can count one new member in the plus column, you must gain enough members to cover what was in the loss column. We're able to do both, and that's why our numbers continue to grow -- not by leaps and bounds, but steadily.
And this is the part that most people find amazing: We haven't raised our membership dues since 1988, and we haven't raised our conference registration fees since 1986. I don't know of any other group that can make that claim. How can we do it? We make it up on volume. As our member and conference base grows, we've been able to hold the line on costs.
The other important thing to consider is that our board has authorized us to sell our research and training programs at reproduction cost, not development cost. That means that a program that should retail in the hundreds or thousands of dollars is sold to members at the cost of copying it, not creating it. And, in the case of our research, we give the key findings of our research to all of our members, and they each get a copy of "What's In Store," our annual trends summary, as part of their dues. Similar books costs thousands of dollars, but we believe in returning equity to the members.
MM: Has IDDBA considered merging with any other trade associations to host its annual convention? Why or why not?
CC: We've been approached several times about merger and/or co-location, and our board has said no each time. This isn't because we aren't interested in growth, but we want managed growth. Our board doesn't believe that we'd be able to service our core constituents (the supermarket dairy, deli, and bakery professionals) if we brought in other shows or markets. We've spent a lot of time and dollars in developing our programs, creating compelling events, and servicing our members. Now that's not to say that other groups haven't done the same; they have. But their focus is on the members they serve, and they're usually very commodity-specific or outside the supermarket. If we merged, we'd dilute our focus, create an expo that would be too huge to navigate, and alienate the core customer we're trying to attract.
MM: With your 2004 convention and exposition right around the corner, is there any single trend that strikes you as being unique heading into this year's event?
CC: One trend is the increase in exhibitors that are developing low-carb products or putting low-carb labels on products that were low-carb to begin with. In some cases this is somewhat similar to the meal solutions fad a few years ago. Exhibitors created special signs and marketing pieces that touted their meal solution products. When I asked how it was different from the year before, they'd point to the sign and say, "We added the sign." "Meal solutions" was a buzzword that was catchy and caught on with everyone but the consumer. But that was the impact. What we have today evolved from that and morphed into a lot of real "meal solutions," but we just don't call them that.
There's a lot of concern about whether low-carb products are a trend that will sustain itself over the long haul, or a short-term fad that's a knee-jerk reaction to this year's spate of diet books. We do know that retailers are just as anxious to find out as suppliers. Consumers are fickle.
As to a new base of attendees, you've probably never heard about associations that turn away customers or don't target everyone in the world. Well, that's us. We have a very specific market in mind, retail food selling with a dairy, deli, and bakery focus. We believe that quality buyers are better than quantity lookers.
The Dairy-Deli-Bake 2004 expo is a trade show for our target markets, and if you're not in it, you can't attend. It took a while for our exhibitors to understand that this was really in their best interest. Some are used to counting heads at trade shows. At our show they count buyers. This means they can bring fewer sales staff (and you know how expensive that is) because they don't have to weed out the tire-kickers. A few years ago I had one major national manufacturer say to me, "Carol, I only saw 25 buyers at the booth." I panicked until he said, "They were 25 of my top 26 customers."
One show-related activity that I'd just like to touch on, because it's a crucial part of our success, is the Show & Sell Center. This is a 10,000-square-foot merchandising theater and kitchen put together by retail volunteers for retailers. This year we have almost 50 people on our team, and the ideas they've come up with are spectacular. In addition to the retailers, brokers and manufacturers serve on the committee. They spend several weekends and many hours in creating the planograms. At the show site they prepare and merchandise everything right there in the convention center. Their incredible dedication and creativity make the Show & Sell Center a compelling reason for buyers and merchandisers to keep coming back to the show year after year.
This year's conference theme is "A Monumental Experience." The Show & Sell Center theme is a "A Monumental Taste Experience." Instead of the four regular departments or categories, the teams have developed "taste experiences" that tie into how consumers look at and eat food. A lot of the displays are over the top and way beyond what most retailers would do. We understand that. But what we're showing is that they can take one idea, one theme, one prop, one product, or more, and create some retailing excitement. We truly believe that the customer appreciates the extra effort and that it makes shopping fun. Most consumers say shopping is boring, so we're showing retailers what they can do and, more importantly, giving them permission to do it by giving them a blueprint (the planograms, case sets, sponsor lists, and products are in a free resource book).
MM: What role does IDDBA's board of directors play with regard to mapping out your organization's future?
CC: Each of our 27 board members must serve on a minimum of two committees. Many have chosen to be on more than that. The major committees meet at our annual business meeting and present the results of their yearlong activities and their "plan of work" for the next year to the board. The board controls the budget, the budget controls the programs, and the staff executes the programs at the board's direction. Additionally, board members are involved in other meetings, in final speaker selection for the conference, and in long-range planning. At our most recent planning meeting, in March, the board reviewed the long-range plan for the next three years, an office relocation plan, an emergency plan and disaster recovery plan, and a succession plan that focuses on developing staff, cross-training, and replacement of key executives. So I'd say they're very aware of what's going on and are very active in mapping out the future for IDDBA.
And, please remember, this is a volunteer board. Not a single person is paid to be on the board, and the manufacturers cover their own travel expenses. The time they spend away from their "real" jobs in meetings and via e-mail, etc., is a professional commitment that they and their companies have made to better not only this organization, but also the industry we serve.
MM: Tell us about IDDBA's top priorities in the next 12 to 24 months.
CC: Our immediate priority is to have a successful show in Washington, D.C. The city has special challenges because everything is high-security. And any time a government official is in or near your building, that creates special challenges, too. Some of the other products we're working on include an update of our five-year benchmark studies on consumers in the deli and consumers in the bakery. Both of these studies will be published this summer. Normally we publish just one study a year, but in this case we're doing two. We're also working on a new video training series for supermarket employees. Current topics include successful demonstrations, providing service in a self-service department, and reducing shrink. The "What's In Store 2005 " is our flagship publication, and we're right in the middle of writing and editing that (yes, at the same time that we're putting the conference together). For the most part it will be business as usual, but we've added a special challenge -- an office relocation. We've been in this building for 21 years and, in order to grow and provide more services to our members, we need to add staff and functional space.
MM: With the enormous changes taking place in the food industry, what do you regard as the allied dairy/deli/bakery industries' greatest hurdles and most promising opportunities going forward?
CC: This one's easy. The big hurdles are food safety, random-weight item identification, product traceability, RFID, reduced-space symbology, COOL, mad cow, bioterrorism, legislation, trans fats, you name it. And the opportunities are there for whoever figures it out first. It won't be easy and it won't be just one solution, but it will change the way we market and track food.
MM: The U.S. Homeland Security Department has identified the food system as one of 13 critical infrastructure sectors in the world. Do you believe most of IDDBA's members have taken the necessary steps to arm themselves with strategic plans and tactical programs for preventing and surviving terrorist attacks and major public health issues, or do you believe more work is needed?
CC: I haven't done a survey or seen any statistics, but my perception is that the larger companies have been very proactive in this area, and the smaller to midsize companies are searching for answers, if indeed they know what the questions are. It takes a mandate to drive a solution. Unfortunately most of the solutions that have been proposed are extremely expensive, are not applicable in all situations, and could drive some operators out of business. We can't get people to agree on what needs to be done, let alone find a solution that will fit all or most cases. It's a work in progress and will continue well into the future.
MM: Looking ahead, can you give us a peek at any looming issues, challenges, and/or opportunities you foresee?
CC: This past year the major perishable food associations have held several meetings to discuss how best to track random-weight and variable-measure products at the front end, item traceability, global commerce, and electronic processing. Right now 50 percent of the supermarket is using a flawed, inconsistent, and outdated tracking system that doesn't have enough numbers and doesn't carry enough data. Since it's a voluntary system, there's no uniformity from chain to chain. Our goal is to bring the perishable departments into the information age with a program that will cross departments and chains, and be compatible with the item identification of consumer packaged goods. The challenge is huge. There's a reason it hasn't been solved in 20-some years of talking about it. But the rewards are very sweet indeed. You'll hear more about it later in the year as plans develop.