It started with paper versions of digital coupons. But that could be just the beginning.
Kroger is responding to customer concerns about grocery prices, by pledging to lower prices and make promotions less complicated, so more deals are accessible to more people.
“We’ve lowered prices on more than 2,000 additional products so far this year,” Kroger CEO Ron Sargent told investors on Friday. And “we’re simplifying our promotions” to make them “easier to access by all customers. And those promotional offers have to offer great value as well.”
Sargent didn’t elaborate on how exactly Kroger plans to make its promotional offers “simpler.” But one way the retailer has already done so, is by introducing “Weekly Digital Deal scan sheets” in select divisions. The single-page sheets, available in stores, feature all of the digital coupon deals advertised in the weekly circular along with a single bar code. Instead of having to go online and clip each individual deal, shoppers can simply scan the bar code and all advertised digital discounts will be applied to their transaction.
It’s part of how Kroger is “making prices easier to get,” Chief Financial Officer David Kennerly said. “So rather than a customer having to get out their phone to get a digital coupon in-store, we’re trying to make the customer experience in store much easier for them to access the good prices that Kroger has.”
The scan sheets only feature a few dozen advertised digital deals. There are still hundreds of digital coupons that do need to be clipped online in order to be used, which can frustrate customers who don’t have digital devices, or find that their digital coupons aren’t always applied correctly. And if you’ve ever missed out on an advertised Kroger deal because you didn’t realize you had to load it to your loyalty account first, or ever didn’t get a sale price because you forgot that a Mega Event “Buy 4, Save $4”-type deal actually requires you to buy four products, you can sympathize with those who find Kroger deals confusing and often can’t figure out why they can’t get the deals at all.
Kroger apparently now sympathizes as well, and doesn’t want to alienate those shoppers who grow tired of jumping through hoops or decide they need to go elsewhere in order to save – while at the same time, catering to those shoppers who do appreciate features like personalized deals and plenty of digital coupons. No matter how they go about it, virtually all Kroger customers are looking to get the biggest bang for their buck.
“Customers continue to spend cautiously in an uncertain economic environment,” Sargent said. “We are kind of seeing a shift into larger pack sizes and increased use of coupons… Many customers want more value, and as a result, they’re buying more promotional products and more of Our Brands products.”
The impact of tariffs is still a wild card. “We are proactively looking for ways to avoid raising prices for our customers, and we consider price changes as a last resort,” Sargent pledged. Part of Kroger’s plan involves “aggressively looking for ways to reduce costs throughout the company, and we expect to reinvest those cost savings directly into lower prices and additional store hours for our associates so that they can better serve customers.”
One way to reduce costs is to pull the plug on several of Kroger’s underperforming stores. “Not all of our stores are delivering the sustainable results we need,” Sargent said. “We plan to close roughly 60 stores, and we’ll do that over the next 18 months.” Precise locations of the affected stores were not disclosed, but “the geography is spread really around the country,” Sargent explained. “It’s kind of ones and twos by division.” Kroger instead plans to focus its efforts on new store openings in other areas.
And hopefully those new stores will offer new, easier ways to save, for shoppers who’ve grown weary of experiencing sticker shock at the grocery store. “We expect the consumer to remain cautious throughout the year. And we’re responding to that,” Sargent said, “with simpler promotions, coupons, lower prices and a lot of own-brand choices.”
So whether you’re a coupon clipper, or just want lower prices without having to work for them, Kroger wants to be your grocery store of choice – no matter how you like to shop, and save.
Image source: Kroger
