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United Fresh 2016: Retailers find challenges, opportunities with SNAP produce incentives

United Fresh 2016: Retailers find challenges, opportunities with SNAP produce incentives

Pilot programs at Kroger Co. and Balls Food Stores to encourage Supplemental Nutrition Assistance Program participants to purchase more produce are off to an encouraging start, but more can be done to increase redemption, the companies said at the United Fresh show on Tuesday.

Kroger launched a program called Fresh Savings at 12 stores in Tennessee and Mississippi in fall 2015 that provides coupons for produce savings to SNAP participants, said Jeff Stilgenbauer, manager of corporate government benefits & payments at Kroger. When SNAP shoppers spend $10 on produce, they receive a printed coupon for 50% off their next produce purchase, up to $10. Participants can earn two coupons each month.

At participating stores, 40% or more of sales come from SNAP customers. “There’s a big need for help there,” said Stilgenbauer.

However, only 8% of the 50,000 coupons Kroger issued through May were redeemed. Stilgenbauer said an in-store volunteer program to educate customers about Fresh Savings wasn’t consistent, and needed more engaging activities to excited shoppers. It was also difficult for cashiers to add another layer to the checkout process.

In addition, promotions need to be tailored to SNAP shoppers, Stilgenbauer said. Kroger should pay attention to when SNAP benefits are added to customers’ cards. The company also needs to be mindful of the fact that many SNAP customers take public transportation to the store and may not be shopping during the day when outreach takes place in stores.

Despite the low redemption rates, Stilgenbauer was optimistic about Fresh Savings and said Kroger plans to expand the pilot to 26 stores by the end of 2017, and eventually expand it to the Cincinnati/Dayton market where the company is headquartered.

Balls Food Stores is in the second year of its Double Up Food Bucks program, which gives SNAP shoppers who use a loyalty card an automatic $1 of free produce for every $1 they spend on local produce. The program is in place at Balls’ Price Chopper stores in the Kansas City area, said Mike Beal, COO.

Last year, Balls had over 9,800 unique customers using the Double Up program and over 23,000 total Double Up transactions; the redemption rate was just under 60%. Moreover, sales of local produce rose 12%, said Beal.

Beal credited the success of the program to the seamless technology that adds the discount to the customers’ loyalty cards. At the same time, Balls learned it had to educate cashiers who didn’t realize transactions would be automatic.

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