Fostering customer loyalty in grocery stores
3/2/09 / David Kennedy
Those of you who know me, know I have strong interests in retail, customer service, and loyalty. This probably stems from my years of retail experience before my shift into research. As such, every time I shop (online or at a brick and mortar store) I have ideas that I think could increase satisfaction, improve the experience, and lead to greater loyalty.
First, my view of loyalty. We are all familiar with customer loyalty programs. You can find them nearly everywhere, from simple punch cards, to complex airline programs, for your morning latte, gas, and, of course, groceries. Many of these programs, however, only foster a transactional loyalty. Meaning, once you earned your free reward, are you any more loyal to the company? If you get 10 punches on your punch card and get a free coffee, are you any more likely to return to start over? (Maybe yes, but it probably isn’t because of the punch card.) Why not defect to another coffee shop and start using their punch card program?
In my opinion, true loyalty is fostered through experience, special privileges, and incremental rewards. The coffee shop you frequent may be more due to you having a regular barista that knows your name and usual drink (experience), giving you samples to try or an extra shot of espresso (special privileges), and a frequent customer program that doesn’t always reset to zero (incremental rewards).
Lately, while visiting grocery stores, I’ve been conducting my own observational research, of sorts. Specifically, I’ve been noticing several ways that the typical loyalty card could be designed to be much more powerful. (For reference, I usually shop at King Soopers or Safeway here in Colorado.)
- At the self-checkout, why does it always ask what language you speak? How you prefer to pay? Shouldn’t your card remember this for you?
- More and more people are bringing their own totes to use for bags and most stores give you a slight credit for this – when they notice. If this is your default behavior, why not prompt the cashier overseeing the self-checkouts that they need to confirm you have them?
- Looking up fruits and vegetables are time consuming if you don’t have the little PLU code. Most people, I believe, buy many of the same fruits and vegetables regularly. Why not have a shortcut menu with fruits and vegetables commonly bought by that customer?
- Millions of Americans have food allergies and they constantly have to check that some little ingredient hasn’t snuck its way into their food. Why not prompt someone when they are about to purchase a food containing whatever they are allergic to? Same could be done for vegans, or other food preferences.
- What if it reminded you if you forgot to buy an item that you always buy (i.e. milk)?
- How about an option to have a shorter receipt, or no receipt at all?
This is only a start. As RFID, smart in-store advertising, and smart shopping carts become more common, the possibilities for improving the shopping experience are endless.
As a footnote, as I was writing this, I received an email from my wife about a new service from Safeway that tracks your family’s nutrition based on what you bought. Hopefully this is a sign of many services to come.