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CSA Exclusive: Kroger keeps Vitacost vital in face of increasing competition

Kroger’s digital health-and-wellness brand relies on leading-edge technology and veteran know-how to maintain a position in the growing niche.

Chain Store Age sat down with Jennifer Palerino, head of digital marketing at Kroger Digital, at the recent eTail Boston conference to discuss how the grocery giant’s Vitacost brand approaches digital direct-to-consumer retailing.

“Vitacost is 100% e-commerce,” explained Palerino. This is our 25th anniversary in the digital health-and-wellness space. We have IT and marketing expertise in the vitamins, supplements and herbs area. We leverage advanced marketing capabilities to help influence and educate consumers.”

Kroger purchased Vitacost five years ago, right after Palerino was hired, to gain a competitive advantage in what was then a still small digital health-and-wellness vertical.

“Shipping earth-friendly, organic products directly to consumers was rare,” recalled Palerino. “Now, they are commonly sold online by retailers such as Amazon, Walmart, and Target.”

The digital health-and-wellness market has opened up as consumers have become much more savvy about omnichannel commerce than in years past.

“There is now an entitled consumer who expects more,” said Palerino. “They want to be communicated to on the device or in the way they like. Younger consumers might want social media or text communications. Email is not for everyone. As consumers, we want what we want, when we want it.”

According to Palerino, this consumer mindset very much applies to the crucial process of delivering digital orders.

“Consumers expect very quick delivery,” she said. “And it can be detrimental if you make a delivery mistake. Get it right – put the customer first.”

Palerino mentioned Vitacost's use of the Selligent Marketing Cloud, and also discussed how the emergence of artificial intelligence (AI) as a mainstream technology is aiding retailers in their digital marketing efforts.

“Instead of business leaders assuming what the customer wants, AI lets them use data to drive decision-making,” said Palerino. “You can use data fields and consumer behavior for promotions to communicate with customers in the right way, on the right device, at the right time. One-to-one personalization is the goal.”

Palerino concluded her comments with advice about using testing to help keep pace with the rapid pace of evolution happening in digital commerce and supporting technologies.

“Always test,” she stated. “Learn as much as you can. Technology changes minute by minute. “But don’t just run tests. Know what your end goal is. How will you use and implement the results?”
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