CINCINNATI -- Consumers would prefer that grocers offer discounts in the food aisle instead of at the pump. The results of a nationwide LoyaltyOne survey show that U.S. grocery shoppers' message for grocery retailers who have been enticing them with fuel rewards for over a decade is that fuel rewards alone aren't winning their loyalty, and that grocery discounts are the new value driver.
In a March 2015 survey of 1,000 U.S. consumers, 72% said they would prefer that grocers offer discounts in the aisle instead of at the pump.
The preference is strongest in the densely populated Northeast, where 81% said they would opt for grocery discounts over gas savings. In the West, 65% favored grocery discounts.
Among the biggest spenders, those who budget $700 a month on groceries, no less than eight out of 10 (83%) expressed a preference for grocery discounts versus gas rewards. Similarly, the majority of shoppers (74%) spending $300 to $500 a month, said they prefer grocery discounts to gas savings.
Older millennials are leading the charge for grocery discounts over gas rewards. Among shoppers 25 to 35 years old, 76% said they prefer grocery, rather than gas rewards. That's five percentage points higher than any other age group in a range spanning from 18 years old to over 65.
"Too many grocers have become complacent with a one-offer-fits-all mentality about loyalty. Not only is a generic fuel offer not relevant to all customers, it equates to untargeted marketing spending undermining ROI," LoyaltyOne consulting managing partner Dennis Armbruster said. "Fuel reward programs still have relevance and value, but our research and client engagements confirm they're also not a cure-all for building loyalty."
Other key findings from the survey:
- 62% of respondents said they would switch to grocery rewards if a grocer offering gas rewards gave them the option of a different type of reward.
- 24% said they would stay with gas rewards.
- 8% said they would opt for travel rewards.
- 6% said they would choose electronics, housewares or apparel.
The survey results are based on an online survey in March 2015 of 1,000 American respondents.
LoyaltyOne is a leader in the design and implementation of coalition loyalty programs, customer analytics and loyalty services.
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