At a time when gasoline stubbornly stays near $4 per gallon, supermarket and gasoline chains are pairing up on loyalty card programs designed to reward their most committed customers.
Retailers are capitalizing on the use of their store cards and partnering with gasoline chains to create a convenient and value-added way for their customers to shop for groceries and gas.
Approaches range from Big Y’s coin program to computerized, card-based programs at Stop & Shop and Price Chopper. Regardless of the system, stores have made a commitment to simplification and savings that are obvious and real to the customer.
Big Y’s Silver Savings Club card issues silver and gold coins to customers, which can be used on groceries or at nearby gas stations.
“With other programs, you accumulate points — you get the savings once a month or you have to use them before they expire,” said Harry Kimball, Big Y’s director of database marketing. “With ours, you can get them every time you go to the station, so that’s really a big difference. We don’t have that cumulative option, but with us, you can go more frequently to get more savings.”
While Big Y doesn’t have its own gas stations like some Stop & Shop and Price Chopper stores do, the chain offers customers many gasoline options.
“We’ve been able to get really good coverage,” Kimball said. “About 90 percent of our stores have a station within a couple of miles or so.”
Price Chopper has a strong relationship with Sunoco, and Stop & Shop works with Shell stations, but Big Y works with a variety of companies. Kimball said Big Y’s many relationships work for both Big Y and the oil companies.
“We help drive customers to their stations,” Kimball said. “They’re out there seeing some of their competitors partnering up with supermarkets, so they have an interest in having a relationship with a supermarket.”
With more than 200 stores and 60-plus of its own gas stations in New England, Stop & Shop was an early adopter with a straightforward approach: for every $100 spent, customers get 10 cents of per gallon of gasoline. If a customer spends $200, they receive 20 cents off per gallon.
The program has proven popular since it was introduced in 2008, said Suzi Robinson, Stop & Shop’s manager of public and community relations.
“It’s about convenience,” Robinson said. “There’s a lot of value for the customers because you’re automatically earning. People are grocery shopping and gassing up all the time — that’s why it makes so much sense to have gas stations right near our stores as well.”
Stop & Shop has increased the options for saving by adding about 600 Shell stations to the program, as well as promoting special products in its stores each week that award extra points.
Price Chopper’s AdvantEdge card works in a similar fashion, with customers earning gas discounts each time they buy groceries.
Mona Golub, Price Chopper vice president of public relations and consumer and market services, said the AdvantEdge card lets customers accumulate points, and offers a longer period before points expire.
“The fact that the Price Chopper program includes not only groceries and flowers and prescriptions but gift cards has been a huge advantage for us,” Golub said. “So, if you spend $100 on a Home Depot gift card, you’re earning 20 cents off a gallon with your fuel AdvantEdge rewards.”
In addition to its own gas stations, Price Chopper’s 127 stores are linked up with some 400 participating gas stations, primarily Sunoco, throughout the region.
Golub said a quarter of a million Price Chopper shoppers enjoy their fuel rewards every week, saving upwards of $8 on a 13.5-gallon fill-up.
“The fact that (food and gas) are on the top of the consumer list of products wanted and needed, and being able to offer savings on both of them at the same time is a dynamic combination that we found truly resonates with consumers,” she said.
Irving Oil is also jumping into the loyalty game, having just launched its own Rewards program at 18 participating Connecticut locations. Irving’s card rewards customers with 10 cents off per gallon for every $200 in fuel purchased.
“Consumers really expect value, and they deserve to be rewarded for their loyalty,” said Irving Oil spokesman E.J. Powers. “Our program couldn’t be any easier.”
While Irving works to make a name for itself in Connecticut, Powers said the company is planning to roll out a social media component soon, promoting a contest that will reward winners with free gas for a year.
David Tomczyk, assistant professor of entrepreneurship at Quinnipiac University in Hamden, said these programs can be quite beneficial to retailers.
“If they get people to focus on the benefits, like the coins, people will think, ‘Every time I go shopping, I get more coins,’” Tomczyk said. “They will want to shop more often because they want to get more coins.”
Retailers offering special bonuses for the purchase of certain products are also taking advantage of the system.
“At the grocery store you may get a discount on cleaning supplies, and those give you money back at the gas station,” he said. “Or, at the gas station, you buy a gallon of milk and you get a discount at the grocery store. It creates an ongoing cycle, and they can bounce people back and forth between the two locations.”
Tomczyk said letting people examine their rewards in a simple way works well.
“Simplicity sells,” he said. “In some programs, you get discounts when you buy so much, but that’s very hard for people to see the benefits. But, if at the end of my purchase, I can see what I saved on my receipt, I can say, ‘Wow’. If I don’t see that at the end of my purchase, I move on to the next place.”
