Grocers Tap Digital Deals to Drive Omnichannel Engagement Amid Ongoing Pressures

As consumers’ grocery budgets continue to be pressured by years of inflation and other economic challenges, merchants are tapping digital deals to drive omnichannel adoption, and in turn to boost customers’ lifetime value.

With consumers who engage across channels spending the most and purchasing the most frequently, Kroger, for its part, is looking to drive sales in the new year by touting deals available through its app and website. The grocery giant announced Tuesday (Jan. 9) that through early February, it is offering “hot weekly digital deals” on private-label products, noting that the event includes “more than $500 in savings available every week in digital coupons.”

“We know this time of year many of our customers are gearing up for a fresh start and no matter what their goals might be, we are here with nutrition support, healthy options and affordable fresh products to embrace the new year,” Carlo Baldan, group vice president of Center Store Merchandising at Kroger, said in a statement.

Across the grocery industry, key players see the importance of digital offers. The PYMNTS Intelligence study “Big Retail’s Innovation Mandate: Convenience and Personalization,” which drew from a survey of 300 retailers across the United States and the United Kingdom, revealed that 74% of grocers think consumers would be very or extremely likely to switch merchants if not offered the ability to use digital coupons and rewards.

Shoppers who receive coupons are more likely to have a positive experience and thus more likely to keep coming back. Last year’s PYMNTS Intelligence study “2023 Global Digital Shopping Index” found that 80% of U.S. shoppers who used coupons were very or extremely satisfied with their experience. In contrast, 60% of those who did not use coupons said the same. As such, coupons increase the likelihood of customer satisfaction by 33%.

Consequently, by seizing on this demand for deals and offers, grocers have the opportunity to convert shoppers to higher-value omnichannel customers.

“As we look across the basket, we for sure see that our omnichannel customers spend more,” JJ Fleeman, CEO of Ahold Delhaize’s U.S. business, reportedly said in September. “They are more loyal, they’re more engaged, and it says that’s really kind of what they want and what they’re interested in from us. … Our omnichannel experience is what we’re really focused on, and we’re really making some good improvements there.”

The demand for digital deals is especially high now, with ongoing economic challenges constraining shoppers’ spending power. As Albertsons CEO Vivek Sankaran noted in a statement accompanying the grocer’s earnings report Tuesday, grocery budgets are being affected by “cycling significant prior year food inflation, customers receiving less government assistance, the resumption of student loan payments and other types of payment deferral [and] inflationary cost increases.”

Digital grocery engagement is on the rise. According to the PYMNTS Intelligence survey “Consumer Interest in an Everyday App,” based on responses from more than 2,200 U.S. consumers, 61% of those who shopped for groceries in the previous month did so via connected devices at least some of the time.