According to survey results previewed at the Food Marketing Institute (FMI) Midwinter Executive Conference by FMI and analytics firm Precima, shoppers rated loyalty toward their primary grocery store quite high (4 out of 5). However, the reality may be different when looking at shoppers’ behavior: Three out of five shoppers would shop at one store if they could have all their needs satisfied, 19 percent typically shop at only one store each week, and only 7 percent allocate more than 90 percent of their weekly grocery budget to their primary store.
“Food retailers need to take a more holistic approach to loyalty than simply viewing it as the domain of the loyalty team,” says Graeme McVie, chief business development officer at Precima. “Retailers will find success in looking at loyalty in 3D by strategically allocating resources to earn customer loyalty, by enabling daily decisions to be made that consistently satisfy shopper needs, and by delivering a meaningfully differentiated value proposition to shoppers through their loyalty programs.”
The survey of more than 3,000 shoppers and dozens of FMI member retailers, recommends that food retailers:
- Think of loyalty as a comprehensive strategy based on insights gained directly from the shopper.
- Consider loyalty as the outcome of daily decisions across pricing, promotions, assortment, space, marketing and store operations.
- Go beyond two-tier price discount programs and provide differentiated value to shoppers.
“The research confirms that shopper loyalty is not a traded commodity and needs to be earned through personalized experiences,” says Pat Walsh, SVP for industry relations at FMI. “The good news is that food retailers are identifying ways to effectively compete in this new omnichannel environment, focusing as much on the fresh categories as the company dedicates to its online presence and e-commerce offerings.”
FMI advocates on behalf of the food retail industry, which employs nearly 5 million workers and represents a combined annual sales volume of almost $800 billion. FMI member companies operate nearly 33,000 retail food stores and 12,000 pharmacies. Its membership includes the entire spectrum of food retail venues; single owner grocery stores, large multi-store supermarket chains, pharmacies, online and mixed retail stores. Through programs in public affairs, food safety, research, education, health and wellness and industry relations, FMI offers resources and benefits to almost 1,000 food retail and wholesale member companies and serves 85 international retail member companies. In addition, FMI has almost 500 associate member companies that provide products and services to the food retail industry.