Dive Brief:

• St. Louis-based grocer Schnucks has expanded its Schnucks Rewards program to six stores in the Rockford, Illinois area, making the program available at all 117 of the company’s stores, according to a company press release.
• Customers who participate in the program will earn 10 points for every dollar spent on qualifying purchases. Once 1,000 points have been accrued, customers will earn $2 off a future purchase. Points can be spent right away or saved up to spend in bulk. 
• The grocer offers a mobile app for members to manage Schnucks Rewards, and shoppers who download it will receive access to additional coupons, a wellness guide and a shopping list organizer.

Dive Insight:

Schnucks unveiled its Schnucks Rewards program last summer, and this announcement brings the program to every store the grocer operates in Missouri, Illinois, Indiana, Iowa and Wisconsin.

Rewards programs aren’t a new concept, but they have been found to be an effective way to increase customer loyalty and boost sales. A 2018 report from the Food Loyalty Marketing Institute found that a $2 billion retailer with a gross margin of 25% can generate $70 million in incremental sales annually with a next-generation loyalty program.

App-based loyalty programs are growing in popularity as a way to give customers a feeling of loyalty and exclusivity while being able to track buying habits. Schnucks took its Schnucks Rewards app a step further in March when it introduced the wellness guide and shopping list features to the rewards app.

Last month, the retailer also launched Deli Order Ahead at 18 stores. This new program allows customers to place their deli order before they get to the store, reducing their wait time and increasing convenience. The company plans to roll this feature out to additional stores and to include more service departments.

Schnucks isn’t alone in competing for customers in the Midwest. Fellow regional retailers have loyalty programs of their own. Hy-Vee’s also includes app-based discounts and features, while the bigger, national chains that serve the area — like Walmart and Kroger — also have programs to keep their base coming back.

Schnucks continues to experiment with ways to enhance the customer experience and make shopping easier. The company is not shy about investing in technology, whether by upgrading its app, offering beer, wine and spirits delivery through Instacart and incorporating robots into its store operations.