Are Grocery Store Loyalty Programs Really Worth It?

Who doesn't want to save money right now, especially as the cost of gas continues to increase to record highs and the total at the end of a grocery receipt makes us stare in disbelief? Could the answer to saving some money be as simple as signing up for a grocery store rewards program the next time that the cashier asks you if you'd like to join?

Historically, grocery stores have offered a loyalty rewards program that involves a customer receiving a plastic card that needs to be scanned each time at check out in order to receive discounts on selected products or to get special coupons. Progressive Grocer adds that the savings on these items are paid for by the brands.

When you consider that the average American spends an average of $5,174 a year or about $431 a month on groceries, according to a January 2022 story by CNBC, it's easy to see why any means to save money may be attractive.

Loyalty programs may save consumers money, but at what cost? While the customer is promised savings with loyalty programs, the grocery store is able to collect data on the consumer when they sign up for the program.

Grocery stores use the programs to track what individual shoppers buy and will create a profile of each loyalty program member to determine how loyal the shopper is to the store, what they buy, and how much they generally spend in the store, Guy Montague-Jones of The Grocer told The Guardian. The store uses this data to aid in decisions over how to price items, the amount of inventory to maintain, and promotions. The Guardian reports that some grocery stores are asked to sell the information they collect about customers to food companies seeking to learn information about their competitors. 

The amount of money a shopper can save via a loyalty program for a grocery store really depends on their shopping habits, according to Penny Pinchin' Mom. It notes that the more loyal a shopper is to a certain business, the more rewarded they will be. While a loyalty rewards program can save a shopper money, Penny Pinchin' Mom advises consumers to still do your research on what you have on your grocery list before you leave the house so that you can make the best decisions about what is on sale.