Kroger lets shoppers redeem loyalty points for grocery savings

Dive Brief:

Kroger has started allowing shoppers to use points they earn through its loyalty program to save money on groceries, the supermarket chain said Thursday. Customers can continue redeeming points for fuel discounts.
Customers will receive $1 off in-store or online purchases for every 100 points they redeem, with a daily cap of $10.
The retailer is making its loyalty program more flexible at a time when it is looking to draw shoppers with a simpler value proposition.

Dive Insight:

Through its latest move, Kroger is catching up with other grocers, including Albertsons and Giant Food, that already let shoppers use loyalty points to reduce the cost of groceries as well as fuel.

Reflecting the change, the retailer said it now refers to “fuel points” just as “points.”

Kroger shoppers earn points when they buy groceries as well as certain gift cards and prescriptions. Customers typically earn one point per dollar, and people enrolled in the grocer’s fee-based Boost subscription program accumulate points at twice that rate.

Kroger is also running limited-time offers designed to help shoppers earn rewards faster. Shoppers will receive four times the standard number of points on purchases made on Fridays until July 24 as well as from July 1 through July 4. People can download a coupon to get extra points on items carrying the grocer’s Private Selection house brand.

Shoppers who elect to use points for fuel purchases will save 10 cents per gallon for every 100 points they turn in, with a limit of $1 per gallon.

Speaking during Kroger’s first-quarter earnings call last week, Kroger CEO Greg Foran, who arrived at the company in February, said the retailer’s promotions had become too complicated and that he wanted to focus on “simpler, more consistent everyday value.”

Foran said he believes Kroger is in a good position but needs to refine its operations to thrive.

“We’re outperforming many traditional grocery competitors, and we’re proud of that, but beating other grocers isn’t the same as leading the industry,” he said, adding, “The runway in front of this business is significant. We have what we need. Now we need to execute.”