Has Kroger found an answer for Amazon Prime and Walmart+?
Kroger appears ready to get on the subscription program bandwagon with the launch of a new service that offers expedited grocery delivery and fuel rewards for its customers. The program, called Kroger Boost, seems designed to be the supermarket giant’s answer to similar services offered by rivals Amazon.com, Walmart and others.
The new service, which is being piloted in the Atlanta, Cincinnati, Columbus, OH, and Indianapolis markets, comes in two price tiers. Customers paying $59 a year get free delivery within 24 hours and two-times Kroger fuel points up to $1 off the price of a gallon of gas. Those paying $99 get free delivery in as little as two hours and fuel rewards. Free delivery is offered on orders of $35 or more.
Kroger sends customers who sign up for Boost “a welcome kit” valued at over $100, according to WLTW. It includes deals from Home Chef, Murray’s Cheese, Vitacost and Kroger’s Our Brands in an offset to the membership fee.
“Customers are increasingly looking for more convenient ways to feed their families and shop for groceries while consolidating trips and saving money. From fresh food to household essentials, Boost elevates everything Kroger has to offer while providing our customers access to a new level of savings and benefits,” Scott Hays, president of the grocer’s Cincinnati/Dayton Division, said in a statement.
Kroger is counting on the fuel rewards to be a significant draw for Boost since prices at the pump have jumped.
“It’s the perfect time to launch with double fuel points,” Stuart Aitken, Kroger’s chief merchant and marketing officer, told The Enquirer in Cincinnati. “If you go to the gas station right now, it’s more than it’s been in a long time, so it’s a great deal for customers.”
The retail giant is also looking to boost sales (pun intended) via digital channels, having set a goal of doubling its $10 billion in online revenues by 2023.
The company said last month that it plans to expand Kroger Delivery, including into markets where it currently has no physical store presence (Northeast U.S.) and in Florida where it has only a single store. Kroger’s automated shed fulfillment facilities using Ocado technology are expected to handle up to $700 million in orders annually. Kroger extends the reach of sheds, which are designed to cover up to 90 miles, with the addition of spoke locations.
- Kroger Boost
- Kroger offering annual membership to customers with free delivery, double fuel points – WLTW
- New Kroger membership program: Double fuel points, free delivery for $35 orders – The Enquirer
- Stores? Kroger don’t need no stinking stores – RetailWire
- What’s Kroger doing most right? – RetailWire
- Will the Kroger/Instacart deal redefine grocery shopping convenience in America? – RetailWire
- Kroger says it will transform grocery e-commerce with ‘first of its kind’ fulfillment tech – RetailWire
DISCUSSION QUESTIONS: Will Kroger’s new subscription options prove popular with the grocer’s customers in the markets where it is being tested? Do you expect the program to be rolled out nationally?