Grocery loyalty

Save A Lot announced in October 2024 the launch of its first-ever loyalty program, Save A Lot Rewards. 

Shoppers can earn points or “dots” to redeem rewards and access deals through a mobile app.

Save A Lot joins a growing list of grocers who have revamped or launched loyalty programs in 2024 to lock in customers.

The launch of Save A Lot Rewards underscores how even discounters are bolstering their ability to highlight value and provide a personalized shopping experience to customers. 

After downloading the Save A Lot Rewards app, Save A Lot shoppers can earn dots, which they can redeem for free products. The app also has exclusive coupons and deals, according to the announcement. 

Individual Save A Lot stores have the flexibility to customize the app with local offers “at no cost” to create a more localized and personalized shopping experience for customers, Katie Kobus, Save A Lot’s vice president of marketing, said in a statement.   

As part of the loyalty program’s debut, Save A Lot offered one-time use, weekly offers for loyalty customers, including 49 cents for a dozen Good Nature eggs and 99 cents for a Crystal Falls 24-pack of water.

Save A Lot bolstered its business operations throughout 2024. In January 2024, the discounter said it has a “rapid growth expansion plan” to bring its store count from nearly 800 to 3,000 over the next few years. 

In March 2024, Save A Lot onboarded Bill Mayo as chief development officer. In October, he stepped into the newly “expanded role” of chief operating officer, where he will oversee marketing and merchandising in addition to leading up the company’s operations team.

Launching and bolstering loyalty programs was an ongoing trend in 2024 as grocers looked to highlight their value to customers.  

Sprouts Farmers Market’s first-ever loyalty program began piloting in the summer of 2024 at two locations with plans for a full launch in 2025. Meanwhile, Giant Food revamped its loyalty program to encourage shoppers to buy more private label goods, offering double points on certain items and lowering prices.

After showing promising results across test markets in 2024, Sprouts Farmers Market’s long-awaited loyalty program will begin a phased rollout in the third quarter of 2025, CEO Jack Sinclair said during a Feb. 20, 2025 call with investors.

The specialty grocer will continue to pilot the loyalty program and “add additional functionality” during the first half of 2025, Sinclair added, without providing additional information. 

The green light for the loyalty program comes as Sprouts reported a strong fiscal 2024 defined by private label expansion and robust growth in comparable sales and e-commerce.

After discussing the program in late 2023, Sprouts introduced it to various test markets throughout 2024, including 24 additional stores in December, Sinclair said. For the past year, the grocer looked to metrics like sign-ups to determine customers’ response to the program, he noted. 

The upcoming phased rollout of the loyalty program will unfold throughout the second half of 2025, he added. 

Under Sinclair’s leadership, Sprouts has worked to solidify its position as a grocer for health-focused shoppers. The introduction of its loyalty program aims to deepen connections with those customers as traditional grocers, mass merchants and discount retailers continue to invest in specialty products and services.

Meanwhile, Sprouts’ private label investments have continued to pay off for the grocery company, with its store brand program accounting for just over 23% of its revenue in fiscal 2024, according to the company’s annual filing with the Securities and Exchange Commission.

The grocer introduced more than 300 new private label items to its assortment in 2024, Sinclair said — nearly the same number of items Sprouts told Grocery Dive in early 2024 it introduced over a two-year span.

Sprouts’ initiative to update and redesign its store brand products is over 90% complete, and the grocer anticipates completing this refresh and redesign of its vitamins and supplements lines in 2025, per the SEC filing. 

Sprouts reported strong fourth-quarter and end-of-year results for fiscal year 2024 with quarterly net sales increasing 18% year over year, to $2 billion, and comparable-store sales growing 11.5%. For FY 2024, net sales grew 13% year over year, to $7.7 billion, and comp sales increased 7.6% according to the grocer’s earnings report released in Feburary 2025.  

The specialty grocer credited positive comparable-store sales and strong new-store performance for its 2024 results, CFO Curtis Valentine told investors on the earnings call.

Sprouts’ e-commerce sales increased 37% in Q4, representing 14.5% of total sales in that quarter, Valentine said. 

Sprouts met its goal of opening 33 new stores in 2024, bringing its total store count to 440 locations across 24 states as of Dec. 29, 2024. While the grocer’s original goal was to open 35 new storefronts, Sprouts scaled that target back by two locations due to the impact of Hurricane Milton, which struck Florida in early October 2024. 

In 2025, the company plans to open at least 35 new stores, all in existing markets, Sinclair said. 

Looking ahead to FY 2025, Sprouts anticipates net sales growth to be between 10.5% and 12.5% with comparable-store sales growth to range from 4.5% to 6.5%, per the earnings report. In addition, adjusted EBIT is expected to fall between $590 million and $610 million.

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By Upside

Data from millions of grocery transactions and thousands of shopper surveys highlight a persistent problem: most grocery shoppers are uncommitted, prioritizing value over brand loyalty.

As consumer behavior evolves, grocers face a growing challenge: it’s no longer enough to win a shopper once. The data shows that retailers must engage customers early in the relationship to earn a second trip, encouraging repeat visits and long-term loyalty.

As acquisition costs rise and retention remains challenging, grocers must rethink how they build long-lasting relationships with customers — starting from the very first visit.

The loyalty myth and the real retention challenge

Most grocers have a loyalty program at the center of their retention efforts. In theory, loyalty should lock in repeat business, but the data often tells a different story. Based on data from an Upside grocery partner, nearly 45% of new grocery customers in a loyalty program never return after their first visit. Think about that number for a minute: For every five loyalty sign-ups you earn, two of those shoppers won’t come back for a second visit. 

And it’s not necessarily for a lack of resources on the grocer’s part. When we surveyed retailers, nearly 40% of them said their customer acquisition costs have risen year-over-year, and more than a third of them have increased their marketing budgets to keep pace.

Especially in an inflationary, promotion-saturated market, grocers are competing not just on price, but on convenience, relevance, and digital access. That’s where the uncommitted customer is rewriting the rules.

Who is the uncommitted customer?

Uncommitted customers put their own value ahead of loyalty to any particular retailer or brand. They shop across banners and formats in order to provide for their households most effectively. They span all demographics and loyalty statuses. From the retailer’s perspective, you might see them making regular small purchases or infrequent large ones without forming a habit to dedicate the majority of their spend to you.

The three defining characteristics of an uncommitted customer are:

• They are value-seeking: Uncommitted customers are price-sensitive, cross-shopping at up to three locations per month to maximize their budgets. In order to change their existing behavior, these customers say they need roughly 10% in savings.
• They are digitally driven: Uncommitted customers have everything they need right at their fingertips. About 90% of these shoppers say they use online sources to discover brands; in grocery, that means they’re comparing prices and seeking value.
• They are opportunistic: Uncommitted customers make decisions about where to shop while on the go. In fact, roughly half of surveyed customers said they decide where to shop less than two hours before going.

Again, although uncommitted customers might not be behaving loyally, they often join loyalty programs. When they do, churn is high early in the customer relationship — and when acquisition dollars are being spent to win these customers, their early exit creates a ripple effect that drags down ROI.

Building habits, not just giving discounts

Uncommitted customers might be hard to win, but it is possible to get their business. The key moment to engage them isn’t months into the relationship — it’s before the second transaction. That’s when behavioral patterns start to form and when the right intervention can tip the scale toward loyalty.

And loyalty programs play an important part in that. Loyalty programs are designed to continuously provide value to customers to incentivize them to return. The most successful grocers aren’t throwing out loyalty; they’re enhancing it with digital programs that address real consumer behaviors. Combining loyalty with other strategies creates compounding value.

In an analysis of 2.7 million grocery customers shopping at over 300 American stores, Upside found that layering multiple incentive strategies had the greatest impact on retention.

The chart below highlights the importance of incentivizing shopping behavior. Shoppers with no loyalty or cash back rewards showed the lowest retention growth. Loyalty programs alone were more successful, but the most powerful impact comes from combining multiple incentives: loyalty and cash back rewards.

Layering these incentives provides the value that shoppers are actively seeking elsewhere, encouraging them to return to your store instead of shopping around for better deals.

Rethinking loyalty for 2025 and beyond

To truly improve retention, retailers need to strengthen their loyalty efforts. Marketplaces that offer cash back incentives can complement loyalty programs, encouraging long-term customer engagement without cutting into profits.

Improving customer retention and earning true loyalty isn’t just about offering discounts. It’s about understanding what each customer needs in the moment and showing up with the right offer, in the right place, at the right time.

By layering proven strategies, like traditional loyalty and personalized incentives, retailers can turn fleeting visits into frequent ones for sustainable growth.

When Giant Food unveiled its Giant Flexible Rewards loyalty program in March 2020, the COVID-19 pandemic was just beginning, grocery inflation was hardly noticeable and the supermarket chain’s approach to thanking people for their business was still heavily reliant on tried-and-true discounts on gasoline.

Five years later, with shoppers hyper-focused on price, the points-based program has evolved into a central tenet of the mid-Atlantic retailer’s broad-based strategy for connecting with customers by emphasizing a commitment to offering value while also guiding people to foods that will help them feel good about their grocery purchases.

Since January 2022, the Ahold Delhaize-owned supermarket company has provided double points on products included in Guiding Stars, the nutrition-rating program it uses to flag good-for-you items for customers, in a bid to encourage people to load up on healthy foods.

“Rewarding healthy options is just an amazing way to provide that emotional connection to customers and really show them that we take their health seriously and we care about them,” said Emily Massi, a registered dietitian who serves as manager of healthy living and merchandising for Giant. 

In April 2024, amid the continuing pressure discounters such as Aldi and Walmart are exerting on traditional supermarket operators, Giant retooled its loyalty program to encourage shoppers to buy more private label goods by providing double points on items carrying the grocer’s house brands, such as bread, milk, bottled water, frozen vegetables and cheese.

Giant said it has also lowered prices on many private label goods, and the company is using signage in its stores to emphasize the price difference between items carrying its names and comparable national brand goods.

“We’re not just trying to sell [customers] things, but we’re actually trying to empower them … and reward them for what they’re doing to build that long-term relationship,” said Ryan Draude, the grocer’s director of omnichannel loyalty and CRM.

About half of Giant’s shoppers have a digital relationship with the chain, which runs just over 160 stores in Maryland, Virginia, Delaware and Washington, D.C., Draude noted.

Giant’s decision to incentivize private label purchases through its loyalty program follows its success in building digital relationships with shoppers by rewarding them for buying Guiding Stars-rated products, according to Draude.

The company has given out about 500 million points, which it values at $6 million, through the initiative, Draude said, noting that the retailer has covered that cost itself rather than with funding from suppliers.

About 115,000 households — representing a third of Giant Flexible Rewards’ membership base — take advantage of the nutrition-focused program every week, according to Draude. The promotion has also translated into stronger sales engagement, with households that opt in to the program boosting their weekly spending at Giant by an average of 6.5% while also making more trips to the company’s stores, he said.

Using rewards to connect with more shoppers

Giant is also reaping benefits by letting shoppers redeem a set number of points for goods like milk, eggs and rotisserie chickens, essentially making those goods available to shoppers without asking them to pay anything, Draude said. The majority of shoppers who take advantage of that program tend to visit Giant stores less frequently than other customers and spend less when they do come in, he said.

“The hypothesis that our team had was if the point levels are low enough that a casual shopper can build these balances and attain the value to redeem, then that type of casual shopper may be the primary user of the program,” said Draude, who led Choice Hotels International’s loyalty program before joining Giant Food. “The ones that are engaging in it the most are the ones that are most transient and have the most share of wallet available.”

Giant recently raised from 100 to 200 the number of points it requires people to turn in for milk and eggs, a change Draude said would help support the changes Giant has recently made to the rewards program’s structure. He added that the 300 points people need for rotisserie chickens translates into a discount because they would otherwise need more points to cover the $6.99 the grocer charges for the poultry.

Giant also allows shoppers to redeem small numbers of points for items that cost between about 75 cents and $1.25, like bagels and lemons, to make it easier for people who have accumulated relatively few points to derive value from the loyalty program.

“We keep looking to see where we might have opportunities to include items that are the highest-volume and the most needed by families,” said Natalia Duane, a loyalty strategy and CRM specialist for the company who helped launch the program.

Giant Food has also been making progress in an effort it began last September to encourage shoppers to provide their loyalty program information when picking up prescriptions at pharmacy counters — an area where people tend to be less likely to think about rewards tied to grocery purchases, Draude said. Through that initiative, the grocer provides people with 100 points for transactions such as filling prescriptions and receiving vaccines.

About 41% of Giant’s shoppers now present their loyalty program information when visiting Giant’s pharmacies, up from 35% when the program began, according to Draude. Giant hoped to boost that figure to 50% by the end of the 2024, he added.

“The whole idea of being a one-stop shop was our mission with having that pharmacy relationship enacted. With grocery, with pharmacy and now with nutrition … we’re really rewarding across the store with any of the products and services that we offer to our customers.”

Albertsons’ loyalty program is flourishing as its membership continues to grow steadily over the years. 

That growth has coincided with efforts by the grocery company, which runs banners such as Albertsons, Safeway, Vons, Jewel-Osco, Shaw’s and Acme, to elevate its rewards offerings. In recent years, grocers have placed more emphasis on their loyalty programs to help convey that they are on customers’ side amid high food prices.

Albertsons’ loyalty program had 25.4 million at the end of fiscal 2020 and saw an additional 4.5 million members the following year, ending FY 2021 with 29.9 million members, according to the grocer’s annual reports.  

In mid-2021 Albertsons replaced its “Just for U” loyalty program with a revamped offering with a new range of deals and rewards for shoppers and also rolled out a new mobile app that combined access to its refreshed loyalty program with its newly launched subscription service FreshPass.

A year later, CEO Vivek Sankaran told investors that loyalty is a key part of Albertsons’ “next phase of transformation” as the grocer seeks to retain customers.

“We want our customers to interact with us daily, not only to shop but sometimes to simply consume relevant content about food or plan meals or find information to inspire their wellbeing,” Sankaran told investors. “Our business model is pivoting to one that is loyalty-based, doubling down on our omnichannel engagement with customers beyond just transactions.”

Gamification is one strategy Albertsons linked with its loyalty program. The grocery company’s Flavor Adventure online game last summer let Albertsons’ banner-branded “for U” loyalty members play games on their desktop and mobile devices to unlock recipes, digital coupons, sweepstakes entries and prizes.

“We have achieved significant success with active participants in our loyalty program, which drives higher sales and customer retention,” Albertsons noted in its most recent annual report. 

Starting with its second quarter of FY 2022, Albertsons stopped holding earnings calls due to its proposed merger with Kroger and began reporting its number of loyalty members during the company’s quarterly earnings results, providing a closer look at how the rewards program has grown. Since then, the grocer has recorded year-over-year increases between 15% to 17% each quarter for its number of customers who have signed up for the rewards program. 

The grocer’s loyalty efforts have seemed to pay off. At the end of its most recent quarter, the grocer recorded 41.4 million members — a nearly 63% increase since the end of FY 2020, which was just prior to the “Just for U” refresh.

In April 2024, Albertsons announced updates to streamline its loyalty program, which included converting to a points-based system, letting members earn points for two months instead of one, and allowing them to convert points to cash at checkout. 

The program’s perks include letting people earn one point for every $1 spent on groceries and two points for every $1 spent on gift cards, redeem points for gas rewards, receive personalized deals, clip digital coupons and get a coupon for a free item every month.

Meanwhile, FreshPass, Albertsons’ paid membership program costing $99/year or $12.99/month, provides perks, such as free delivery on orders over $30 and double points on exclusive brand products.

Schnuck Markets is striding ahead to demonstrate to consumers that it values their well-being.

Throughout April 2024, the Midwestern supermarket chain provided shoppers across its four-state footprint with $5 in Schnuck Rewards points per week if they recorded 50,000 steps in a seven-day period through its “Healthier Habits” program. Schnucks also planned to dole out larger numbers of points to randomly selected shoppers who participate in the initiative, which uses an app from fitness company FitLvl.

In addition, Schnucks provided double points on purchases of about 5,000 better-for-you products to shoppers who sign up for Healthier Habits during the first half of April. Those items, which the grocer gives a “Dietitian Pick” designation, include foods like produce, lean meats and whole grains that have limited levels of sugar, sodium and saturated fats.

Schnucks’ move to link its loyalty program with health-focused activities and nutritious foods reflects a growing trend among food retailers as they look to strengthen shopper loyalty.

About 70% of grocery stores have strategies centered around nutrition, health and well-being, according to a survey report published in February 2024 by FMI — The Food Industry Association. Moreover, half of shoppers who participated in a separate FMI survey said they feel their primary food store places a premium on helping them stay healthy, the trade group reported in late 2023.

In February 2023, Albertsons rolled out an online platform to help shoppers make decisions about health-related factors like exercise, sleep and nutrition. The program, “Sincerely Health,” also gives people loyalty points for locking in a health goal or following a suggestion offered by the system.

Beyond rewarding people for the steps they take and buying healthy foods, Schnucks runs a program through which it alerts shoppers at selected stores when freshly picked foods arrive from farms. The service, which Schnucks runs with startup Foodshed.io, uses tracking devices in produce containers to track products during their journey to the store and generates an alert via the Schnucks Rewards app when shipments come in.

Kroger announced in October 2024 that it added Disney streaming options to its annual Kroger Boost membership.

Members can now choose between three subscriptions: Disney+ Basic with ads, Hulu with ads or ESPN+.

The added streaming benefit follows similar moves by Walmart and Amazon, which have streaming options as part of their subscriptions.

Kroger’s additions to its Boost membership put the grocer more in line with Walmart’s membership moves as companies aim to add perks to bolster the perceived value of subscriptions.

The new streaming option is “adding even more value at no added cost for our members,” Stuart Aitken, Kroger’s senior vice president and chief merchant and marketing officer, said in the press release. 

Kroger Boost members who pay $99 annually can select one of three streaming options to add for the duration of their membership, and members who pay $59 annually can select a free six-month subscription once, the announcement noted. 

Boost members already receive exclusive offers, earn fuel points and have access to free delivery services over orders of a certain amount. 

Earlier in 2024, Kroger held a two-week sales event giving Boost members access to exclusive deals. 

Membership enrollment for Boost, which Kroger launched in 2021, “exceeded the company’s expectations” for its inaugural year, Kroger said last summer. 

Walmart added a Paramount+ Essential subscription to Walmart+ in 2022. For Walmart+ Week in June 2024, the company announced a limited-time introductory deal for its subscription program offering Paramount+ with Showtime free for six months.

Walmart+ members are “heavily engaged” and shop twice as much as people who aren’t members, Venessa Yates, Walmart+ senior vice president and general manager, said during an Omni Talk interview at Groceryshop. 

Grocery Outlet recently an app in 2024 that’s unlike those of other food retailers, with an emphasis solely on promoting savings while driving customers to its stores. 

Grocery Outlet completed the rollout of its no-frills app to all of its stores in its first fiscal quarter of 2024 and saw an instant response from shoppers. During the discounter’s most recent earnings call in August 2024, President and CEO R.J. Sheedy noted that the app had over 700,000 total downloads at the end of the second quarter.

“We continue to see high levels of customer engagement with our personalization app. … Our app allows us to communicate our weekly deals to customers, provide early access to special offers and customize their treasure hunt experience,” Sheedy told investors.

The new app comes at a time when the grocery industry is focusing on providing omnichannel experiences and turning to apps as a way to bridge online and in-store shopping. While many supermarkets, mass retailers and discounters are grappling with e-commerce profitability challenges even as they bring in online sales through their apps, Grocery Outlet's new app emphasizes two core facets of its identity: discounts and in-person shopping.

Grocery Outlet’s website describes its app as “a central hub where you can see the most up-to-date deals, in-stock products and exclusive offers at any time.”

Inside Grocery Outlet’s app

Grocery Outlet wants to excite its shoppers with the savings they can get at stores — a strategy that the company’s app reinforces at every turn with personalized savings tools. 

After picking their preferred store, users can view the latest deals at that location, browse the digital aisles and see their savings as well as their spending — total, monthly or yearly — from past purchases linked to their loyalty card.

The “Digital offers” and “Sweepstakes” sections show coupons and contests. Under the former, Grocery Dive spotted a coupon that provides $5 off a purchase of at least $25. In September 2024 the grocer ran a sweepstakes for “free groceries for a year” for people who provide their loyalty number when they shop to earn entries. The grocer’s app also promoted a “Win What You Saved” sweepstakes, which rewards five shoppers every month. 

Red-lettered messages that highlight just how much the discount grocer has reduced prices are the focal point of the app. This includes a 45-ounce bag of Blue Diamond almonds for $9.99, which is a savings of “up to” 67% off, and a 79-cent can of Del Monte Fresh style green beans that represents savings of “up to” 76%. 

The “Weekly ad” section lets users see potential savings by category, including beverages, bread and bakery, dairy, deli, fresh meat and frozen. Customers can add items to their digital shopping list and sort items by “most popular” or “highest savings” when browsing the digital aisles.

The “Wow alerts” section shows featured discounts based on the selected store location.

Two pop-ups — an “exclusive offer” to get 10 bonus entries for Win What You Saved when opting in for email alerts and a $5 in-app coupon — appeared during a nearly one-hour span of using the app. 

Customers who use their digital loyalty card or phone number when checking out can track their purchase history in the app. 

How the app stacks up

In comparison to other grocery apps offered by companies like Giant Food or Walmart, Grocery Outlet’s app provides a stripped-down grocery shopping experience with savings as the primary focus. The app’s product pages, for example, include a photo of the item, its name, price and discount percentage but don’t list ingredients or nutritional information. 

In addition, while Grocery Outlet’s app places an emphasis on showing product discounts by store location, it doesn’t allow customers to place an online order. (People who want to shop Grocery Outlet online have to go to one of its e-commerce partners: Uber, DoorDash or Instacart.) 

The Grocery Outlet app also doesn’t appear to have other features that are common on other retailer apps, like recommendations on product pages, SNAP eligibility information or reviews. There also don’t appear to be any coupons users can clip for individual products — a nod to the discounter’s focus on low prices through its opportunistic buying model. 

It’s clear the app aims to be a tool for in-store customers or for people planning their shopping lists before going to the store. 

In the August call, Sheedy noted that the app is a “traffic driver,” noting that the real-time store inventory reflected on the app “is a great way to bring customers in.” 

“We believe that this app will increase engagement even further and lead to greater customer loyalty, which should accelerate trip frequency and share of wallet growth,” he said.