How independent grocers can leverage SNAP to boost revenue and loyalty

Matt Smith is co-founder and COO of Grocerist, an e-commerce technology and marketing solution that helps independent grocers take control of digital to drive growth in-store and online. Matt has 20-plus years of digital marketing experience, and has also founded and run several startups. At Grocerist, he works closely with clients to help them better reach and engage customers in their communities.

While SNAP (formerly known as food stamps) is accepted at more than 250,000 physical stores across the U.S., only a handful accept it online, and more should. The technical hurdles that once existed have been dismantled with new technology made available by the USDA and its partners to ease the process. 

SNAP shoppers tend to be very loyal, making them an attractive segment for grocers of all sizes, and these shoppers are now increasingly going online. According to the USDA, “In November 2022, nearly 4 million SNAP households shopped online, which is a substantial increase from March 2020, when about 35,000 SNAP households shopped online.”

Independent grocers not already looking into enabling these alternative payments on their site are losing out on an important revenue channel and an opportunity to increase customer loyalty.

Many grocers remain intimidated by SNAP online, but if they haven’t explored options for online SNAP acceptance in a year or more, they may be surprised at all of the new options available. These options also extend to other state and federal assistance programs such as Double Up Food Bucks, a program that helps SNAP recipients stretch their benefits by matching SNAP dollars spent on fresh fruits and vegetables. 

In the past, enabling alternative payments like SNAP, Double Up Food Bucks and various health benefits cards were challenging for smaller, independent grocers to implement both in-store and online because of the custom integration required. Typically, only big retailers or grocers like Walmart or Krogers could afford the upfront payment and custom integration to make these alternative tenders work.

But with advances in technology this has become a much simpler, more affordable process for independent grocers, allowing them to make major inroads online to compete with the grocery giants. 

Independent grocer Little Red Box is one. The company added SNAP online acceptance in early 2023. According to Samuel Newman, founder Little Red Box, “Enabling online SNAP EBT is going to be a game changer for many of our customers who would prefer to go online to use their benefits instead of doing it in person. We are in a food desert so it’s also very hard for our customers to travel to their local Walmart or major grocery chain.”

Over the next few years, wholesalers, co-ops, merchants, and third-party partners will all be working together to continue to expand access to low cost, healthy food options and increase the impact of nutrition assistance government-funded programs. 

For these programs to be widely available for shoppers at their local grocer, the payments solutions need to be supported using an affordable, scalable ecommerce platform. 

Our recommendation now to independent grocers is, if you’ve already enabled payments like SNAP and Double Up Food Bucks in your store, ask your e-commerce provider on how quickly and cost-effectively you can implement those services online.

For grocers who have not yet implemented these payments in store, they should be planning now for an omnichannel strategy, leaning on a scalable ecommerce platform that can easily support multiple alternative tenders online.