INTERNET, LOYALTY CARDS GAINING GROUND AS MARKETING METHODS

COLE CORBIN

LARGO, Fla. -- As the supermarket industry continues its commitment to technology-driven promotions, the number of retailers with a Web page has doubled in the past year, and consumers are joining multiple frequent-shopper programs in higher numbers than ever before.

These are among the results highlighted in the 20th Annual Survey of Promotional Practices, conducted by Cox Direct here, a direct-mail company. The study surveyed 41 retailers with annual sales from under $100 million to more than $1 billion. In addition, 757 consumers nationwide took part in the survey.

One area that has seen significant increases is marketing, particularly via the Internet. According to the survey, 49% of the retailers surveyed said they now have a Web page, an increase from 24% last year. In addition, another 20% of retailers reported they plan to create a Web page within the next 12 months.

The survey also showed that 89% of retailers are currently using the Internet or World Wide Web in some way.

The study noted that consumer interest in on-line services, such as electronic coupons, is increasing. However, only 12% of responding consumers currently use on-line and Internet services to search for product coupons. According to the study, 32% of consumers characterized the ability to receive on-line grocery coupons as very beneficial, a 2% decrease from last year.

Based on consumers who use on-line and Internet services, 14% said they believe shopping for merchandise on-line would be worthwhile. Only 8% of those consumers, however, feel the ability to shop for groceries from home would be beneficial. Frequent-shopper programs are increasingly popular promotional tools. The study showed that 60% of retailers currently offer such programs. The increasing number of frequent-shopper programs is spurring customer interest as well; 72% of consumers said they are aware of available customer-loyalty programs, an increase from 62% a year ago.

Among consumers aware of frequent-shopper programs, 78% are currently members of a loyalty program, up from 67% in 1997. The study reported that 42% of all surveyed consumers have one membership, 25% have two memberships, 8% belong to three frequent-shopper programs, and 11% have three or more memberships.

In addition to marketing products to consumers via the Internet and frequent-shopper programs, retailers continue to explore the value of kiosks and electronic shelf labels. Currently, 68% of participating retailers use interactive kiosks to offer product recipes, and 58% use them to offer coupons.

Electronic shelf labels are being used by 35% of retailers, and the number of retailers installing the electronic tags could grow to 45% next year, according to the study.