Loblaw’s efforts to save face with customers by issuing $25 gift cards after intentionally inflating bread for 14 years is an “inadequate remedy" to restoring consumer trust, according to a public relations expert.  

“What Loblaw is doing with their gift card program is cold comfort crisis communication,” Bob Pickard, principal at Signal Leadership Communication, told BNN via email. “On one hand, it is a commendably proactive PR gesture and offers real money to consumers; but, on the other hand, it is an inadequate remedy considering the reality of what they have done.”

Loblaw began offering customers $25 gift cards in January after fessing up to the bread price-fixing scheme between late 2001 and March 2015, along with distributor George Weston Limited.

The grocery chain will release its fourth-quarter results on Thursday – the company’s first earnings report since it admitted to participating in the scheme in December. Both Loblaw and George Weston have said they don’t expect the gift card plan to affect their dividends.

The companies were granted immunity from prosecution by the Competition Bureau for coming forward and cooperating. But they have faced backlash from rivals Metro and Sobeys, whose CEO – Michael Medline – has called on Loblaw chairman and CEO Galen G. Weston to retract statements implicating the chain in the scandal. 

Despite the immunity, consumers may not be so forgiving of Loblaw or its efforts to remedy its actions.

 In a BNN poll conducted last month, 77 per cent of the 2,965 respondents said Loblaw isn’t doing enough to rebuild goodwill after the scandal.

“The bigger image problem here is definite damage to the Loblaw brand, which may now have lower trust and a tarnished reputation as a result of this corporate misdeed,” Pickard said.

“The good news for Loblaw is positive alignment with the social media campaigns rallying consumers to get these cards to donate food purchases for local food banks,” he added.

Sylvain Charlebois, dean of Dalhousie University's Faculty of Management, told BNN in a telephone interview Loblaw’s move to offer a $25 gift card has served the company well, and that it would be wise to continue with the campaign.

“If I were Loblaw, I would stick to the original plan. ... Consumers are probably upset and disappointed with what happened, but they’ll carry on probably, and they’ll continue to buy products at Loblaw.”

“Price and convenience are key drivers no matter what,” he added. “The jury’s still out on what company has been affected by this scandal. What brand has been negatively impacted by this scandal? Is it Loblaw or is it everyone?”

In addition to continuing to promote the $25 vouchers, Charlebois said Loblaw could also offer aggressive promotions in the bakery sections in an effort to rebuild customer trust. But, ultimately, he thinks this scandal is something customers will forget about in the long-run.