Kroger marks 1st year of Boost by Kroger Plus membership program

The Kroger Co. has declared a successful first year for its Boost by Kroger Plus online paid membership program—for both customers and the company.

Members saved more than $115 million via Boost by Kroger Plus, which rolled out nationwide in July 2022 after a soft launch in selected markets in late 2021. The Cincinnati-based supermarket giant said late Monday that Boost signups “have exceeded the company’s expectations” in the inaugural year for the program, which also has lifted customer engagement across stores, digital channels and fuel centers.

The Boost subscription—offering free delivery, fuel rewards and exclusive savings—competes with the Walmart and Amazon Prime shopper benefits programs and has been a key tool in helping Kroger grow online grocery market share, especially as the supermarket giant builds out its Ocado-automated delivery fulfillment network.

“Boost by Kroger Plus is making grocery delivery accessible to more customers through the industry’s most affordable membership program,” Stuart Aitken, senior vice president and chief merchant and marketing officer at Kroger, said in a statement. “Combined with our industry-leading fuel points program, customers are saving big on groceries and fuel unlike ever before.”

Boost is offered in two membership tiers, priced at $59 or $99 annually (or at $7.99 or $12.99 monthly). All members get free delivery for online orders of $35 or more and double fuel points for each dollar spent on groceries and general merchandise. The $59 annual membership provides next-day delivery, while the $99-per-year option offers delivery in as soon as two hours. For each 100 points earned, customers save 10 cents a gallon on fuel, up to $1 per gallon.

New Boost members also receive a one-time “welcome package,” valued at over $100, that offers exclusive savings on Kroger “Our Brands” private-label products, including under the Murray’s Cheese, Vitacost, Home Chef, Simple Truth and Private Selection brands. Kroger has said the kit offsets the first-year cost of membership and estimated that Boost can save customers more than $1,000 per year on fuel, groceries and delivery fees—based on a $99 membership, two deliveries per week, a $91 weekly grocery spend, 13 gallons per fill-up and twice-monthly fuel point redemption.

A video with Kroger's animated Kroji characters touts the delivery and savings benefits of Boost by Kroger Plus. / Image courtesy of Kroger

To mark the first year of Boost by Kroger Plus, Kroger has launched a special anniversary offer of 1,000 bonus fuel points to consumers who enroll in a new annual membership from Wednesday to Aug. 8.

“We are so grateful to our members who joined us in our inaugural year, and we look forward to offering more savings and welcoming new members,” Aitken added.

In 2021, Kroger announced a goal to double its digital sales and passthrough profitability rate by the end of 2023, driven by its seamless omnichannel experience and ecosystem. Boost has a potentially massive market reach. The nation’s largest supermarket operator, Kroger operates about 2,750 grocery and multi-department stores in 35 states under more than 20 banners. Approximately 11 million people shop with The Kroger Co. daily, and the retailer generates 2.8 billion annual visits and serves 60 million U.S. households.

At the BMO Global Farm to Market Conference in May, Kroger Senior Vice President of Operations Mary Ellen Adcock said Boost by Kroger Plus is “definitely resonating” with customers in terms of the delivery options offered. In tandem with wider e-grocery access via Ocado customer fulfillment centers (CFCs) and “spoke” facilities, the membership program is helping to increase the value offered to shoppers, number of items purchased and basket size, as well as attract new customers in current markets, she noted. (Conference transcript provided by AlphaSense.)

Chief Financial Officer Gary Millerchip said at the conference that “how many new customers” isn’t the main focus of Boost.

“It has really been about, we still see a huge opportunity to win share of wallet from existing customers. We’ve actually been pleasantly surprised that there are a significant number of new customers, even in areas like where we have the CFC in Ohio, where Kroger has a high density of stores. We’re still seeing customers that are saying, ‘I wouldn’t have viewed you as being a convenient local store, but this service allows me access to Kroger,’ ” Millerchip explained.

Kroger’s Boost subscription service reflects an ongoing trend of grocery retailers trying to lock up followings of loyal, omnichannel shoppers via membership programs, à la Amazon’s hugely successful Prime customer benefits plan, which also extends to its Whole Foods Market subsidiary. Retailers now offering such subscription programs include Walmart (Walmart ), Albertsons Cos. (FreshPass), Publix Super Markets (Club Publix), Ahold Delhaize USA’s The Giant Company (Choice Pass), Hy-Vee (Hy-Vee Plus Premium), SpartanNash (Fast Lane) and Harris Teeter (Express Lane), among others.