Kroger Launches Personalized Coupons to Win Loyalty of in-Store-Only Shoppers

Kroger is applying its digital data capabilities to drive spending with its most traditional customers.

Consumer-packaged goods (CPG) marketing company Catalina announced in a Thursday (Jan. 26) press release that it has teamed up with 84.51°, grocery giant Kroger’s retail media arm, to deliver printed coupons to in-store shoppers, bringing previously digital-only offers into physical aisles. The program, Catalina Reach Extender, will use in-lane printers to dispense hard copies of personalized offers to shoppers.

“We look forward to using this breakthrough technology to bring meaningful savings to even more customers,” Cara Pratt, senior vice president of Kroger Precision Marketing at 84.51°, said in the release. “The ultimate aim of using Catalina Reach Extender is to engage 100% of our shoppers with the best possible access to value. This expansion will enable CPG brands to engage even more shoppers with inspiring products for their homes and families.”

Certainly, many consumers continue to shop exclusively in stores. Research from the latest edition of PYMNTS’ ConnectedEconomy™ series, “The ConnectedEconomy™ Monthly Report: Meet the Zillennials,” which drew from a survey of nearly 4,000 U.S. consumers, found that even among the most digitally engaged groups, a significant share abstains from eCommerce.

With millennials, the generation most likely to purchase groceries online, 66% do so, leaving a sizable 34% still shopping exclusively in stores. Conversely, with baby boomers and seniors, the group least likely to engage digitally and a group making up a disproportionate share of the population, only 23% purchase groceries online, leaving 77% to shop only at physical stores.

Notably, printed coupons such as the ones Catalina is creating are not the only way to reach exclusively in-store shoppers. A significant share of in-store consumers bring technology into the physical aisles, improving their brick-and-mortar experience with digital convenience.

Research from PYMNTS’ study “Big Retail’s Innovation Mandate: Convenience and Personalization,” created in collaboration with ACI Worldwide, found that the majority of grocers believe in-store digital technologies are key to customers’ loyalty. The report, which drew from a survey of 300 major retailers in the U.S. and U.K., found that 74% of grocers think that consumers would be very or extremely likely to switch merchants if digital coupons and rewards were not provided to in-store customers.

Consequently, personalized rewards have been a major focus for grocers in recent months. Michigan-based supermarket chain Meijer, which has nearly 500 stores across the Midwest and Kentucky, recently announced the launch of an update to its mPerks loyalty program to improve its rewards personalization capabilities.

Albertsons Companies, meanwhile, is looking to improve its personalization capabilities by working with other businesses to expand its data access. Earlier this month, Pinterest announced that the grocer is the first business pilot testing the social media platform’s new clean room solution created in partnership with data platform LiveRamp. The initiative offers a walled digital space for Albertsons to connect its own first-party data to Pinterest’s data, generating anonymized insights into consumer behavior.

Indeed, coupons have a marked impact on shoppers’ satisfaction. The “2023 Global Digital Shopping Index,” a PYMNTS and Cybersource collaboration that drew from consumer panels from six countries spanning more than 13,000 participants, found that 80% of U.S. shoppers who used coupons were very or extremely satisfied with their experience. In contrast, only 60% of those who did not use coupons said the same. As such, using coupons makes consumers 33% more likely to be highly satisfied with their shopping experience.

There has been a rapid uptick in adoption and availability in the recent past. The study found that 70% of U.S. shoppers reported using and being aware of coupons, promo codes and rewards in 2022, up from 59% in 2021.