NEW YORK -- Six Northeastern chains are participating in a holiday co-promotion designed to increase store traffic and higher-margin sales by encouraging use of the American Express card in their stores.
Shoppers using their cards as a payment method at participating stores are eligible for bonus rewards from American Express Co. here.
One goal for the retailers is "to drive traffic into our stores during the holidays," said Andrew DePaolis, corporate vice president of advertising and marketing for Grand Union, Wayne, N.J.
Though the six participating retailers would not give specific results, Grand Union told SN its stores have experienced additional store traffic since the program was launched Nov. 22.
Grand Union has "roughly 110 of our 225 stores participating," DePaolis said. "We are seeing more foot traffic in our stores, and anticipate greater profits.
"American Express cardholders are usually higher ticket sales; we notice they also shop the perimeter of our aisles, purchasing higher end products," DePaolis added. "This leads to a greater gross profit."
The promotion, which runs through Dec. 31, is live in selected stores throughout New York, New Jersey, Pennsylvania, Connecticut and Delaware.
Participating chains include ShopRite, a division of Wakefern Food Corp, Elizabeth, N.J.; A&P, Montvale, N.J.; Acme Markets, Malvern, Pa.; Foodtown, a division of Food Circus Supermarkets, Middletown, N.J.; Grand Union, Wayne, N.J.; and Super Fresh Food Market, a division of A&P.
As customers use the card for purchases of more than $25, they earn 75 bonus points toward specific rewards. Customers are limited to 1,000 points during the monthlong promotion. The rewards are usually good toward travel incentives such as hotel, air fare or rental car discounts, according to DePaolis.
Though the rewards are only available through American Express, the supermarkets are "supporting the program to provide an extra service to our loyal customers," said Michael Rourke, senior vice president of communications and corporate affairs for A&P.
"All 193 of our ShopRite stores are participating in the customer rewards program," said Laura McCafferty, spokeswoman for ShopRite. "Though American Express is sponsoring the promotion, it is positive for us to be a part of a promotion that offers cardholders the chance to earn additional reward points."
Even though transaction fees for American Express are generally higher than those for credit cards, retailers feel their benefits outweigh the costs.
"We do not see the processing fees as an obstacle that would make us dissuade customers from using the card," said DePaolis. "Part of the reason is that we see a higher return based on the order size and items purchased by American Express customers as compared to regular credit-card customers."
"We should not discourage our customers from using their cards," A&P's Rourke said. "Our customers want to use the card in our stores and we want them to have that convenience."