-By David Diamond

I recently wrote in these pages about Whole Foods and the excellent job it does in serving a diverse customer base. The punch line in that article was that Whole Foods succeeds by focusing not on all of the diverse external constituencies affecting its stores, but on the consumers who shop in them.

This isn't a secret formula. What works for Whole Foods could also work for any other food retailers. With times becoming tougher and the environment more competitive, it's now more important than ever for food retailers to focus on their shoppers, and to remember to make business decisions in the context of the effects those decisions will have on the consumers in their stores.

One leader at listening to consumers is my alma mater, Procter & Gamble. In recent years, under the leadership of A.G. Lafley, P&G has rededicated itself to the idea that the consumer is king -- -and that the role of the company is to find out what consumers want, and deliver it to them.

In a new book, The Game Changer, Lafley and co-author Ram Charan make the case that consumer focus is one of the few key principles that transcend evolving business conditions. They argue that things are changing fast, and that we as businesspeople need to change rapidly to keep up. But they also argue that there are a few things that you must truly embrace to succeed, and one of those is that the consumer is king.

The power of this idea, when systematically applied, is startling. It becomes the tie-breaker in many business situations, and the driver in others. It's a place to go back to when you're feeling lost. It becomes a base from which all business evolution needs to be measured. Most importantly, it becomes a yardstick to measure all business changes against. If the change works for the consumer, it's probably a good idea, and vice versa.

Google vs. Yahoo!

In the world of emerging media, no battle is more closely watched than that between Google and Yahoo! for supremacy in the world of search and online advertising. Google is widely viewed as winning, and I would argue that this is because, while Yahoo! worries about advertisers, ad sizes and technologies, Microsoft, and all sorts of other things, Google worries about only one thing: the consumer experience on the site.

This was hammered home recently when both Google and Yahoo! unveiled the integration of video ads into search results. Not surprisingly, both companies issued press releases extolling the virtues of their different approaches to the product. Yahoo! showed its nifty video icon, and how banners and videos could be integrated into a consolidated ad buy. It demonstrated how it had integrated video into the Yahoo! search experience, and how the advertiser could benefit from that integration.

Google, on the other hand, showed its video integration, which consists of a blank box below the paid search ad, which reads "view ad." That's it. According to Google, that's all that's needed. And why did it take this minimalist approach? Because it tested a variety of versions with consumers, and this was the one that maximized business results for the advertiser, for Google, and -- most importantly -- for the consumer executing the search.

Google was clear in its press release that it selected the minimalist approach because that's what consumers preferred, and so that was what the company responded to. You don't need to be a mind reader to guess who I think has developed a better approach to this product.

This lesson is a critical one for me, as well as for any retailer. It's easy to listen to those constituents who have easy access to management: employees, store management, vendors, suppliers -- even us lowly scribes and consultants -- but it takes real work to listen to your customers. And if this column has a reason for being, it's to urge all food retailers to take more time to listen, and to explore more methods of listening.

Right attitude

First and foremost, listening is a matter of attitude. We need to remind ourselves, day in and day out, who's boss. We need to create a culture in our stores that focuses all of our employees, all of our vendors, and all of the people we work with on our consumers and on meeting their needs. And this culture needs to be created, endorsed, and lived by those at the top of the management pyramid.

But it's all too easy to declare that we're committed to a consumer focus in our business. The tough part is how to implement this change and institutionalize it as part of our business going forward. Here are a few suggestions:

--Break down the barriers between the marketing budget and the market research budget. Historically, we all begin the fiscal year with a large marketing budget and a much smaller market research budget. And then we spend the whole market research budget in the first 60 days, or it gets cut because the quarter is a little weak. This segmentation happens because we characterize market research as "nonworking" spending -- that is, it doesn't translate directly into sales.

This leads us to the idiotic bias that it's better to do something, no matter how ineffective, than to stop and spend a little money to figure out what to do first. We need to get over this. Let's make market research an integrated part of the marketing budget, and promise ourselves that before we do something, we spend a little time and money asking consumers whether it's something they want.

--Retailers have great data, but often forget to use it. Take inventory of the data sets you currently collect -- T-logs, sales data, frequent shopper data -- and ask yourself if you're mining this data for all of the insights it could provide. I can guarantee you the answer is no. Then spend some time thinking about what you could learn about your consumers from data you already possess.

--Take inventory of what you'd really like to know about your consumers. Get your marketing team in a room with a whiteboard and simply make a list of those questions you have, from the most general (what do they really dislike in my stores?) to the highly specific (do they really want four varieties of heirloom tomatoes?). Then winnow the list down to the most important questions, and develop a plan to get them answered.

--Invest in smart people to ask the right questions and get the right answers. Understanding consumers isn't simple. It requires people with both a technical understanding of market research and an intuitive feel for consumers and how they think. Make an investment in some of these people. It might feel like an extravagance at first, but if you get some good folks thinking about your consumers, you'll learn some remarkable things.

--Integrate the activity of asking consumer questions into all of the activities of your business. Don't isolate the market researchers, but rather give the market researchers the ability to work throughout your organization. Don't make understanding the consumer the responsibility of the market research or marketing departments; make it everyone's responsibility, and give everyone the tools they need to ask questions and get responses.

All of these steps will move your organization toward a state of consumer awareness and consumer-centricity that should enable you to focus on the right things and make most of the right moves. Let the consumer be your guide.

And when in doubt, ask.