Kroger expands customer payment options

The Kroger Co. has launched Kroger Pay and Kroger Rewards, new mobile and debit payment solutions aimed at speeding checkout by blending customers’ payment and loyalty information.

Kroger said Wednesday that it recently introduced the Kroger Pay mobile payment tool at its Columbus, Ohio, division. Plans call for the tool to be rolled out to 10 more markets in the spring and then go nationwide later this year.

The new Kroger Rewards debit card also has gone live at stores in the Columbus division as well as at King Soopers and City Market stores in Colorado, Kroger said. The card is slated to become available across Kroger Co. store banners this spring.

"Kroger is redefining the customer experience by creating innovative ways to pay at our stores and online," Gary Millerchip, CEO of Kroger Personal Finance and corporate strategy integration lead, said in a statement. "Kroger Pay and the Kroger Rewards debit card are two more ways we are transforming our payments model to benefit our customers."

A feature within Kroger Co.’s roster of mobile apps, Kroger Pay gives customers a single-use QR code to scan at checkout for communicating payment and loyalty card information, including digital coupons and personalized offers. To securely transmit the data, shoppers first enter a custom PIN or use biometrics to confirm their identity.

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Kroger noted that Kroger Pay reduces checkout time and creates a more frictionless experience for store associates and customers by offering a one-step payment solution. The tool also rewards customers using a Kroger payment card — including the 1-2-3 Rewards credit card, Rewards prepaid debit card and new Kroger Rewards debit card — by enabling them to earn grocery rewards and fuel points in one scan, the company said.

Kroger Pay can be used in regular checkout lanes and self-checkout stations and can be linked to any major debit, credit or prepaid card.

"Kroger Pay is one of the few mobile wallets that pairs loyalty and payment," said Mary Ellen Adcock, group vice president of operations at Kroger. "The application of this exciting technology is another step in our front-end experience transformation."

The Kroger Rewards debit card, meanwhile, connects directly to a customer's checking account and serves up an array of shopper benefits, including bonus fuel points, Kroger private brand discounts and double rewards when the card is used through Kroger Pay. 

"Our new Kroger Rewards debit card is a lower-cost payment option, enabling us to offer our customers additional savings when they are shopping in a store or online or fueling up," Millerchip added. "Through Restock Kroger, we are lowering operating costs, and our new debit card is another way we are doing just that while also rewarding customers who use it."

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Kroger Personal Finance, along with Kroger’s 84.51° data analytics arm, are linchpins of the Cincinnati-based company’s drive to ramp up alternative profit streams to help achieve its target of $400 million in operating profit by 2020 under Restock Kroger. To that end, Kroger is working monetize the huge stores of purchase and customer data amassed from its position as the nation’s largest supermarket company, including 2,800 stores, vast digital properties and millions of daily transactions.

At an investor event this fall, Stuart Aitken — named last month to the newly created post of senior vice president of alternative business — said Kroger has behavioral data on 60 million households, and 96% of all transactions are tied to its Plus Card, which he called “the most robust data set in the industry.”