How Digital Grocery Shopping Is Fueling Kroger's Success

The Kroger supermarket chain, based in Cincinnati, has posted some impressive sales figures for the first two quarters of 2022, resulting in upward revisions of sales expectations for the year, according to Supermarket News. For the first half of 2022, Kroger reported sales of $79.24 billion, up a whopping 8.6% over the first half of 2021. What's fueling this growth? It's adaptation. The grocery business used to be much simpler than it is today. 

Shoppers used to make lists on scraps of paper, clip their coupons from the Sunday newspaper, and make the trek to the grocery store in person. Attractive piles of produce, eye-catching endcap displays, and advertised sales were strategies stores used to bring shoppers in the doors and guide their purchases. My, how things have changed. 

Now, more consumers choose to shop online or use an app like Instacart to have their groceries delivered right to their doors. How has Kroger managed to not only survive the evolving landscape of the modern grocery store, but thrive?

An omnichannel experience for a grocery store means bringing together all the ways consumers interact with a store and meeting those consumers where they are. Yael Cosset, chief information officer and senior vice president for Kroger, told CNBC, "You just can't be a 1990s grocer. You have to be courageous, break things, and quickly adapt." Cosset cited Chinese retailer Alibaba and its grocery stores, Freshippo, before discussing an effective way of leveraging things like automated fulfillment, convenient QR code use for payment, and targeted ads, as well as emerging trends like grocery delivery and online shopping. One example of Kroger's innovation is using data to more effectively guide its operations and make decisions about questions like which aspects of its operations should be automated and which should be directly handled by employees.

Digital Commerce 360 checked in with Kroger CEO Rodney McMullen about the company's impressive growth for 2022, and McMullen cited just the sorts of innovation Cosset has been working toward. McMullen said the company continues to fund digital growth initiatives and pointed out the more than 750 million digital offers downloaded by consumers in Q2, with savings of nearly $1 billion. 

Coupled with the success of its private label brands, Kroger appears to be ahead of the curve when it comes to digital grocery shopping.