Exclusive Q&A: Kroger's 84.51° data group examines customer loyalty trends

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Customer loyalty requires increased personalization.

Customer loyalty is evolving due to external factors and shifting preferences.

Chain Store Age recently spoke with Becky Eldredge, VP commercial loyalty at 84.51°, Kroger’s  data analytics subsidiary, about how customer loyalty is changing and how retailers can adapt to shifts in the consumer marketplace.

[Read more: CSA Exclusive: Kroger Precision Marketing connects brands to shoppers]

How have customer loyalty patterns shifted in the last couple of years?

Customer loyalty doesn't mean exclusivity anymore. It’s based around either the brand that customers most prefer, or the retailer that they prefer to shop at. There are two external factors as to why that has changed.

One is the COVID-19 pandemic, from the standpoint of product availability. Customers were forced into changing their loyalty based on overall availability. The second external factor is the inflationary period that we have been experiencing over the last year. What Kroger hears from our customers is because of inflation, they are forced to make decisions.

How can retailers increase consumer loyalty and trust?

Customers want good sales and promotions, they want high-quality fresh foods, they want assortment, and they also want a retail or rewards program that delivers value to them.

How do you think loyalty will evolve in retail in the next 12 months?

Customers have the ability to shop different places and brands in different modalities, at the click of a button. It will become more important than ever that retailers hone in on driving that connection and engagement with customers, because of how easy it is for customers to to change.

There will be three key areas of engagement. One, I think personalization becomes critically important. The second area is around omnichannel integration. Because the modern consumer is a hybrid shopper online and in store as well, it's going to become really important that brands and retailers are engaging with customers in a multi-channel way, whether they're shopping in-store or shopping online, and anticipating those needs that change over time as well.

The last piece is around the evolution of flexible rewards. As we think about loyalty, there will be the emerging need to deliver flexible rewards, almost along that same idea as personalization from the standpoint that a reward mechanism for me might look a little different than a reward mechanism for you in terms of what matters most to each of us. So I think honing in on that becomes really important as well.

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