33 Percent Of Grocery Customers Would Use Digital Coupons If Retailers Offered Them


Grocery shopping is clearly no longer confined to the aisles of the local Kroger or even a superstore like Target or Walmart. With services like AmazonFresh and Peapod, consumers can load up on kale, chicken — or whatever they need for their next meal — from their computers or smartphones.

Online grocery sales are a booming business, with the eCommerce segment expected to make up 20 percent of all grocery sales by 2025. Traditional brick-and-mortar grocery stores are seeking to adapt to this new market through ominchannel marketing. Kroger, for example, plans to spend $9 billion over the next three years to modernize, according to the Omni Usage Index.

As the online grocery business grows, retailers that sell the products that stock refrigerators and pantries across the country are seeking to expand their marketing efforts across multiple channels — online and in-store. When trying to connect with consumers or offering them a deal on a product, here are five things to keep in mind.

— One-third, or 32 percent, of customers of large-format grocers would appreciate social-sharing efforts, and 12 percent already do. Through platforms such as Instagram, for example, grocery brands can promote their products and show what the end results of a successful trip to the supermarket could look like. As Insta’s focus is entirely visual, grocers can show appealing recipes and party spreads using products that can be found in their aisles. Retailers can take advantage of other social media platforms too, such as Snapchat. One grocer has even used Snap to document each step of a fish’s journey from sea to market, captured with Snapchat Spectacles. Still, it should be noted that a whopping 42 percent would not use this feature, so not everyone wants follow a fish’s journey on Snap — at least not yet.

— While a large percentage of large-format grocers already use digital coupons, 40 percent, 33 percent would use them if retailers offered them. Target, for example, has a mobile app called Cartwheel that brings manufacturers’ digital coupons to consumers’ smartphones. From the app, consumers can “clip” coupons that, in some cases, are the same ones found in the local newspaper. As TechCrunch has pointed out, this digital method of coupon clipping increases Target shoppers’ potential savings, as manufacturers’ coupons frequently offer greater discounts than those offered only through the app, like special offers on Target’s private label products.

— Many large-format grocery store customers, 41 percent, use rewards — but 35 percent would take advantage of them if retailers offered them. Some grocers like Stop & Shop have their own loyalty programs. Others may rely on third-party platforms such as Shopkick, which allow consumers to earn rewards while grocery shopping and drive sales for grocers. Over a year of research and development, Shopkick Grocery was found to increase consumer basket sizes to $59 in grocery, drugstore and retail spend per trip versus the $32 national average. Likewise, Shopkick Grocery increased weekly visits to the grocery store and increased consumer engagement at the shelf, according to the company’s research.

— Paper coupons are popular, too. Thirty-nine percent of large-format grocer customers take advantage of them, but 37 percent would clip them if retailers made them available. Believe it or not, old-fashioned coupons remain a viable method to reach retail consumers. Surprisingly, nearly 90 percent of millennials actually use paper coupons that come through the mail, and response rates to consumer mailings are up 60 percent from 10 years ago, according to direct mail marketer Valassis.

— And while only about a quarter, or 26 percent, of large-format grocery store customers currently opt in to marketing, 33 percent would use that feature if provided by a retailer. Reaching customers can be a tricky business, but having customers opt in to marketing reduces unwanted messages, personalizes advertising and makes it useful to the consumer. For grocers, information from the opt-in process can provide valuable brand engagement and return on investment (ROI) data.

As online entrants into the grocery space grow, traditional brick-and-mortar retailers are looking for digital partners to help usher in the digital era of groceries. Kroger executives reportedly are in talks with Alibaba, the Chinese eCommerce retailer, for example.

Through such a deal, consumers in the future could be inspired to buy a new kitchen appliance or cookware as they roam the produce section, allowing Kroger to make the sale — instead of another retailer.

Inmar study: 45% of shoppers load digital coupons to loyalty cards

AUTHOR Dan Alaimo PUBLISHED March 19, 2018

Dive Brief:

  • Forty-five percent of shoppers have loaded digital coupons onto their loyalty cards, according to the Inmar Promotion Industry Analysis and its Shopper Behavior Study, reported by Supermarket News.
  • Coupons are changing shopper behavior. The study found that of shoppers with coupons, 39.1% said they would buy a product sooner; 39% said they would buy a brand they otherwise would not have considered; 38.5% said they would buy more of a product; 29.9% said they would buy a different product within a brand; and 18.1% said they would switch back to a product.
  • Digital coupons have seen five successive years of double-digit increases, with the strongest growth in share of redemption for load-to-card, which is now up 587% from 2013 to 2017. Print-at-home and free-standing inserts (FSIs) showed declines in that same time period, with minus 27% and minus 21%, respectively.

 Dive Insight:

Coupons are changing with the times and have never been more important for driving traffic, sales and brand conversions.

Brands and retailers need to meet shoppers wherever they are on the shopping journey, Holly Pavlika, senior vice president of marketing and content for Inmar, wrote in Supermarket News. In particular, moms from the millennial generation look for offers before, during and after a shopping journey. Convenience and savings on digital and mobile are big drivers, she said.

This means paper coupons distributed with FSIs in the Sunday newspaper must still be considered, as they still dominate distribution and redemption. For example, FSIs accounted for 90.8% of all coupons distributed and 34.6% of all coupons redeemed in 2017. While smaller in number, digital coupons were higher in percentage of redemption. Load-to-card incentives were 1.1% of all coupons distributed, but 10.9% of all coupons redeemed. Seventy-seven percent of shoppers said they had a shopping list for the store, and 44% said they looked for digital coupons before the shopping trip. The ease of putting the coupon discount on the loyalty card makes this a more painless exercise compared to clipping paper coupons.

In a related finding, marketers distributed 38% more of the load-to-card coupons last year, compared to the year before. Redemption of digital coupons increased 67% in that time span. Additionally, Huffington Post has reported that 80% of consumers are more likely to purchase and interact with a brand that offers an engaging mobile encounter.

To stay on top of this changing consumer behavior, supermarket operators must be prepared to accept — and promote — all kinds of coupons. Advanced point-of-sale systems make this possible, and also enable to monitor purchases with coupons for fraud. Among regular load-to-card coupon users, 90% reported that the coupon changed their shopping behavior — an opportunity retailers shouldn’t ignore.