Hannaford Sees Licensing in Stars’ Future

By EDWARD D. MURPHY Staff Writer

Hannaford Bros., based in Scarborough, wants to be the first out of the blocks in a new area of brand identity: reliable and understandable nutrition information. A head start could be vital because competition is right on its heels.

Eighteen months ago, the company launched Guiding Stars, a four- step rating guide to the nutritional quality of the products in the company’s stores. Now, it plans to license the system to others in the food business.

Within the next few weeks, Hannaford will spin off its Guiding Stars operation into a new, wholly owned company. The firm – whose name is still under development – will license the concept and promotional material to other grocers, food-service companies, manufacturers and possibly even government agencies.

Meanwhile, Topco, an Illinois-based buying cooperative with dozens of mid- and large-sized chains as members, will offer its own ratings system later this year and also has established a separate company for licensing.

Hannaford officials hope that being the first will give it an edge in establishing a recognizable rating system for nutrition- minded grocery customers.

"If there’s going to be a national standard, we’d like ours to be the de facto standard by virtue of being ubiquitous," said Julie Greene, director of healthy living for Hannaford.

Topco’s ONQI – which stands for Overall Nutritional Quality Index – will debut by fall, and soon customers may see a couple of rating systems on store shelves.

More information on nutrition is a good thing, said Michael F. Jacobson, executive director of the Center for Science in the Public Interest, but he worries about shoppers trying to sort out different rating systems, depending on which grocery store they happen to go into.

"It’s a recipe for confusion," he said.

Hannaford uses Guiding Stars in its 158 stores in the Northeast, as does the Sweetbay chain in Florida, which is also owned by Hannaford’s corporate parent, Delhaize America. ONQI officials say they expect many of its 63 grocery chain members – such as IGA, which has stores in Maine – will roll out the system later this year and has heard from other companies looking for information on licensing.

Although both systems attempt to do the same thing – give customers a quick and understandable way to gauge the nutritional value of food – they go about it somewhat differently.

SIMPLE WAY OF LOOKING AT THINGS

Hannaford uses stars, giving foods with little or no nutritional value no stars. One, two or three stars are awarded to those with more nutritional value. ONQI uses a 1-to-100 system, with more nutritious food gaining a higher score.

Hannaford said it rolled out Guiding Stars after consumer research indicated that customers wanted more nutritional information, but that they found the panels on the back of most food packages – containing information on items such as calories, fat, sodium, cholesterol, carbohydrates and protein – less than illuminating.

"They told us, ‘I’m confused,’" Greene said. Claims made by manufacturers – "a third less fat" or "better for you" – are simpler to understand, but viewed as less trustworthy.

Hannaford turned to experts from colleges and universities who came up with a formula based on the numbers drawn from the nutritional panels.

"Essentially, to score well in this program, the product has to have more positive attributes – vitamins, fiber, minerals and whole grains – than negative attributes – saturated fat, trans-fat, cholesterol, added sodium and added sugars," Greene said.

Greene said Hannaford looked at different ways of translating those scores into consumer-friendly information. Customers surveyed rejected "best in category" as insufficient, while depicting where a product fits into the government’s food pyramid was deemed too complex.

Also rejected was a British system based on traffic lights. A few more whimsical suggestions, such as a skull and crossbones for those products deemed unhealthy, also were discarded.

"We don’t want the food police," she said. A product that earns a low score "is not morally wrong."

Eventually, the company settled on the stars as a simple way for customers to look at similar products, such as two boxes of cereal, and quickly decide if one is more nutritional than the other.

Company lawyers warned that manufacturers would create "a firestorm" over the stars, Greene said, but they were "by-and-large OK with this approach." Hannaford said the system has changed buying habits. For instance, sales increases for yogurt that earned stars were 5.5 times as great as the increases for no-star yogurt. The biggest difference between the yogurts, Greene explained, is added sugar.

Licensing the system is one way to recoup the "considerable" cost of developing the system, Greene said. She declined to say how much a license will cost, but noted that it would differ depending on factors such as how many products not already in Hannaford’s database would need to be rated

Greene said the timing of the decision to start licensing was driven in part by the knowledge that ONQI would soon be arriving as a competitor.

APPLES TO ORANGES OR TO STRUDEL

ONQI came about in reverse order of Guiding Stars, with a rating system devised by academics who then saw the commercial prospects.

It was developed by Dr. David L. Katz, who heads a preventive medicine research organization backed by Yale University and Griffin Hospital in Derby, Conn. Topco heard about the system, approached Katz and they agreed to set up ONQI as a separate company to pursue licensing.

Despite the different origins, the motivation was the same, said Nancy McDermott, president of ONQI. And, both Hannaford and Topco recognize that an easy-to-understand rating system can be as valuable to a grocery brand as a reputation for fresh produce.

Customers, McDermott said, "are looking for someone to cut through the clutter."

Virginia Mann, a spokeswoman for Topco and ONQI, said the 1-to- 100 rating system allows for a little more nuance than a four-step star system, and it can also be easily applied to recipes, by averaging the scores of the ingredients, weighted by the proportions.

"You can compare apples to oranges or you can compare apples to apple strudel," Mann said. "It allows you to make well-informed choices about every food. It’s like having a nutritionist with you when you’re shopping."

Jacobson, the head of the Center for Science in the Public Interest, declined to back one approach over another, but said either system is an improvement over manufacturers’ claims or even the efforts of some medical groups, which might proclaim one product as better for heart health or for people with diabetes, for instance.

But, he added, consumers may soon become overwhelmed by a variety of rating systems and – as with manufacturers’ claims – not enough information on the trustworthiness of the various nutritional guides.

"What we really need is a study that would compare the effectiveness of all these approaches," he said.

Staff Writer Edward D. Murphy can be contacted at 791-6465 or at:

emurphy@pressherald.com

(c) 2008 Portland Press Herald. Provided by ProQuest Information and Learning. All rights Reserved.