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The Future of Grocery Loyalty Programs

By: STCR Staff 

Gone are the days of inky newspaper circulars dominating the couponing landscape in the grocery industry. Today’s shopper is much more tech-savvy, and they look to many different sources for deals when grocery shopping. As competition between grocery retailers becomes fiercer, grocers are finding it more imperative than ever to entice shoppers with coupons and loyalty programs. We live in the information age, and the data compiled through loyalty program registration is worth the cost of offering shoppers incentives. The top grocery stores utilizing 21st century loyalty programs understand the value and the best practices involved in doing so.

Harness the power of data

The most valuable benefit of offering a loyalty program is the chance to capture data about your customers and in turn, understand who they are and which products they want. The key here is to focus on top customers and offer them incentives to be even more loyal. When grocers have intel regarding what their top shoppers usually buy, they can then offer targeted deals giving them a first look at new products they may enjoy, special deal days or just higher-tiered offers designed just for frequent customers.

Kroger has mastered this concept with their new debit card and seamless mobile payment program, both of which give shoppers that use them double loyalty rewards. This strategy has allowed Kroger to grow the proportion of shoppers that they consider premium loyal shoppers by tailoring the store to serve the loyal shoppers’ needs. Increased data means making better promotional decisions and better pricing decisions.

Go mobile

Mobile phones are the new sources of information for the majority of modern shoppers. Where shoppers once depended on their local newspaper for sale information, the modern consumer now relies on email marketing and store apps to find deals. Millions of consumers use grocery shopping list apps, many of which can connect to smart watches and virtual assistants. Stores without their own in-store app are missing out on an opportunity to be in the palm of their customer’s hands while they shop.

With today’s technology, location-based targeting can send coupons to a shopper’s phone that correspond with the aisle they are shopping in, giving real-time offers. Apps with shopping list features also provide valuable data about which products customers prefer, and can assist in targeting email or mobile coupons for items they buy regularly.

Avoid the pitfalls

Loyalty programs are not foolproof, and there are several key guidelines to consider when implementing a multi-channel loyalty program.

  • Return value: Each customer’s personal information is a valuable tool, and stores should reward those who decide to opt-in by making sure that the offers are enticing enough to justify giving up personal data.
  • Don’t ask for too much: Every request for personal information when signing up for a loyalty program should be considered a promise that the value will be returned. Make sure you can follow through by offering enough value to make up for this.
  • Offer more than discounts: Discounts are appreciated, but consumers today are used to a certain level of personalization. Using data to alert shoppers about sales or product availability that aligns with their preferences adds to perceived value.

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