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 PYMNTS.com 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.