Kroger goes national with paid, two-tier loyalty program

The Kroger Co. is moving a paid subscription pilot into full rollout across the country.

The supermarket giant is now offering its Boost by Kroger loyalty program across all of its banners nationwide. The annual membership provides customers unlimited free grocery delivery on orders of $35 or more, fuel discounts of up to $1 per gallon and additional savings on Kroger’s Our Brands private label products. Kroger estimates the membership can save customers more than $1,000 per year on fuel and grocery delivery.

Boost expands on savings currently available to customers through Kroger's free loyalty program. Offering two annual membership levels at $59 or $99, the new service provides free next-day delivery or free delivery in as little as two hours on orders of $35 or more, respectively. Boost members also receive double fuel points for every dollar spent, as well as exclusive savings on private label items.

During the last several months, the grocer piloted Boost in four divisions. According to Kroger, results included a growing number of new members and a significant increase in delivery sales compared to non-Boost divisions.

Kroger has spent the last few years developing next-generation infrastructure to support rapid online delivery. Its continually expanding customer fulfillment center (CFC) concept, introduced in partnership with U.K.-based online grocer Ocado in May 2018, combines vertical integration, machine learning, and robotics with affordable and fast delivery service for fresh food.

The CDC facilities leverage proprietary technology solutions focused on artificial intelligence (AI) and advanced robotics and automation to create more seamless and efficient fulfillment, picking and delivery capabilities for enhanced digital commerce capabilities across the U.S. Kroger is also leveraging its CDC “hub and spoke” network to enter markets where it does not have a physical store presence, such as South Florida and the Northeast.

"As customers continue to evolve how they shop and eat, this expansion of our loyalty program offers more personalized value in groceries and fuel, alongside easier access to convenient shopping solutions, such as delivery," said Yael Cosset, senior VP and CIO for Kroger. "We are committed to consistently delivering a best-in-class seamless experience with zero compromise – the fresh and quality products our customers want, how they want it and when they want it. We recognize this is especially important as our customers are facing an inflationary environment and rising fuel prices."

"Boost contributes to our rapidly expanding seamless ecosystem, bringing value and convenience to many more families across America as we roll-out new delivery fulfillment centers,” said Bill Bennett, Kroger VP and Head of e-commerce. "Through Boost, Kroger is uniquely positioned to be ‘fresh for everyone,’ making grocery delivery accessible to more customers through the industry's most affordable grocery delivery membership program. Combine this with our industry-leading fuel points program, we are confident we have built a differentiated membership program that our customers will love."

Kroger operates nearly 2,800 stores under a variety of banners that include Kroger, Ralphs, Dillons, Smith’s, King Soopers, Floors 4 Less, Fry’s, Harris Teeter, Fred Meyer and others.