Grocery Loyalty: How Retailers Can Make Grocery Shopping A Habit
Table of Contents
The online grocery segment has grown dramatically during the pandemic. With rapidly changing consumer habits, digital transformation initiatives have been accelerated across all retail segments. Before the pandemic, Instacart, the independent grocery delivery service, had initially estimated that only 20% of American households would be shopping for groceries online in the next 5 years. But during this past April, its order volume went up by 150% and the increase in new downloads of its app increased by a whopping 7X. To meet the demand, Instacart had to hire 300,000 new shoppers. Other large players like Amazon Fresh, Costco, and Walmart grocery delivery have also seen increases in their online orders. While this spike is well received, leading retailers are trying to equip themselves with the best digital tools to cater to this jump in grocery loyalty online.
Given that digital transformation is now an imperative for the grocery segment, grocery retailers must seize this opportunity to implement technology that can boost grocery loyalty visits.
Grocery retailers can look to improve grocery store loyalty by not merely offering a loyalty program, but also offer personalized rewards and recommendations based on data from the loyalty program. 66% of consumers who belong to loyalty programs will modify spending to maximize rewards. And when grocery retailers go online, it becomes crucial to combine offline and online data to create a complete and cohesive picture of their customer and their buying habits preferences. By incorporating AI-based customer intelligence and retail personalization tools, grocery retailers can offer personalized recommendations based on their customer’s dietary preferences, allergy information and more! Additionally, they can use data from loyalty programs to understand, segment and reward their customers. For example, they can issue coupons for customers who have been interacting less frequently and additional discounts for customers who are regular and loyal.
Given the regular nature of grocery shopping, it is essential for grocery retailers to invest in technology that can enable better personalized search and discovery for your customers. By investing in AI-Powered Data Extraction and catalog management tools, retailers can harness detailed product information to power better search and discovery. Customers can be shown recommendations based on latent attributes, for example, dietary preferences like ‘keto’ and ‘gluten-free’. By allowing customers to search based on attributes, versus just product name, retailers can offer a rich browsing experience that will have them returning to the platform. AI allows retailers to build product graphs based on affinities like brand, price, ingredient and other attributes (gluten-free, keto-friendly, low fat, allergen-free, etc) that can provide meaningful recommendations to customers and allow them to discover new products that are relevant to their needs, thereby boosting conversions.
Grocery shopping is habitual in nature and most consumers buy the same set of groceries – such as fresh produce or even pantry staples – in a recurring manner. Grocery retailers must look to make the lives of their customers easier by offering technology that can curate their cart automatically, so they don’t have to go through the manual process of adding items that they purchase regularly. If this process can be combined with rich product data, the retailer can power meaningful recommendations even when the products that customers need are out of stock.
Without a doubt, digital transformation is an imperative for grocery retailers. But given the highly competitive environment that is prevalent today, retailers must look to invest in technology & AI solutions that can help them create rich experiences for their customers and ensure that they stay loyal to their brand.
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