Clean Up On Aisle 3: A Guide To Grocery Loyalty Programs

Inflation has caused a massive rift in consumer behavior, prompting grocers and supermarkets worldwide to consider the implications of rising prices on grocery store loyalty. With the Consumer Price Index (CPI) experiencing a staggering 20.4% increase, the trend shows no sign of slowing down.

In fact, it's predicted to rise by another 6% in the coming year, according to the USDA Economic Research Service. This inflationary pressure is reshaping consumer behavior, leading individuals to gravitate toward grocery stores in pursuit of cost savings. Now, more than ever, is the time for brands to establish and nurture customer loyalty through their grocery loyalty programs. 

How to Build Grocery Store Loyalty?

1. Acknowledge the Changing Landscape

Dining out is no longer on the menu for a significant portion of consumers. A whopping 58% of individuals reported eating and drinking out less in 2022 as a response to macroeconomic stressors, as revealed by Eagle Eye Solutions. Meanwhile, grocery store items were noted to be one of the last household budget items to be cut. Takeout options also took a dive, with 45% of consumers reporting ordering less and choosing to cook more at home.

As households move away from full-service restaurants, dine-out, and takeout options, there has been a noticeable increase in grocery store spending. This shift underscores the importance of building effective grocery loyalty programs that your customers love, as they turn to your brand as a reliable source of savings.

2. Embrace the Role of Value

In this environment of rising prices, consumers are more economically motivated than ever to seek value in their purchases. The best grocery store loyalty programs proactively position themselves as beacons of value, offering products and services that provide maximum value for every dollar spent. 

3. Embrace Rising Purchase Power 

Customer Lifetime Value (CLV) is becoming a superfood in the grocery industry. On average, people visit the grocery store eight times a month, as reported by Drive Research. As prices soar and purchase values increase, brands have a unique opportunity to enhance CLV by increasing the customer lifespan. It's essential to give your customers compelling reasons to come back for more, thus ensuring long-term grocery store loyalty.

4. Optimize Mobile Experiences

The mobile experience remains a key ingredient in the grocery shopping journey. A significant 63% of grocery shoppers shopped digitally in 2022, according to Incisiv. Customers rely on their grocery apps to unlock coupons, find weekly sales, and discover product-specific discounts, making a positive mobile experience a must. In fact, 51% of customers stated that they would be less loyal if the online experience wasn't as enjoyable as the in-person one, as highlighted by PWC. This underscores the importance of investing in mobile-centric grocery loyalty programs, providing the right mix of in-person and digital experiences. Need a hand? Check out our guide to loyalty and rewards for grocery stores and supermarkets

5. Deliver Value Through Discounts

Discounts top the grocery store loyalty shopping list, with 79% of consumers expressing a desire for them, as revealed in the Loyalty Barometer Report. This marks a noticeable jump from previous years. While personalization, customer experience, and omnichannel approaches remain crucial, grocery stores must reevaluate their rewards and benefits to align with the new economic landscape. Discounts should be made accessible both in-store and on mobile apps, as 53% of customers actively seek out discounted items or promotions, according to Eagle Eye.

6. Harness the Power of Data

An overwhelming 83% of consumers are willing to share their data in exchange for a more personalized experience, according to Accenture. Brands should leverage purchase behavior to craft individualized customer experiences and rewards that align with their customers' preferences.

7. Personalize Discounts for Maximum Impact

Personalization has become the standard, with 71% of consumers expecting it, as reported by McKinsey. Grocery stores must infuse personalized messaging and rewards throughout the entire customer journey to stand out in a fiercely competitive landscape, driven by inflation-conscious customers on the hunt for value. Notably, 80% of customers want to make purchases when offered personalization from retailers, according to Epsilon & GBH Insights.

It's Time for a Fresh Approach to Grocery Loyalty Programs 

While inflation may pose challenges, it also presents significant opportunities for grocery brands to thrive. Adapting to shifting consumer behaviors by providing value, nurturing customer loyalty, optimizing mobile experiences, offering discounts, harnessing data, and personalizing discounts can enable brands to succeed in these turbulent economic times. As customer preferences evolve, adapting to meet their needs is essential for long-term success. 

To learn more about building effective grocery loyalty programs in this changing landscape, explore our extensive grocery loyalty library of expert blogs, white papers, case studies, and e-books today, and see our infographic in a link below!

See the infographic

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