Kroger confirms the worst fears and will make a 180º turn in the U.S.

In recent years, many supermarket chains have opted for the digitalization of their promotions. The strategy has been efficient for some, but it hasn't been free from criticism. As consumer habits change, large retailers are forced to react.

In this context, Kroger has announced a significant transformation in their stores in the United States. The goal is to adapt to the needs of vulnerable consumers, such as seniors or people with limited resources, who can't easily access digital offers. As if that weren't enough, the company also confirmed that they will close 60 underperforming stores in the next 18 months.

Kroger launches new measures to curb digital inequality

Since 2022, several consumer associations had been warning about a growing problem: digital discrimination. In a letter addressed to industry leaders, they warned that digital promotions exclude millions of people without internet access or without smartphones. "They're forced to pay more for the same products that others get with discounts," the statement said.

Kroger has reacted to these criticisms by introducing a more accessible solution. In recent weeks, they've started placing physical "Weekly Digital Deals" brochures at the entrance of their stores, according to Detroit Free Press. These brochures show all available digital offers and can be scanned directly at self-checkout stations or registers.

"Scan your card or enter your alternate ID, then scan this brochure to automatically activate each digital coupon," read the signs at Kroger. The coupons can be used up to five times per transaction and are updated every week. According to a spokesperson for the chain, this measure aims to "make it easier to access the full value of our stores."

More cautious customers and a massive store cutback

This move also responds to a change in consumer behavior. During the latest earnings call, CEO Ron Sargent acknowledged that customers "are spending more cautiously in an uncertain economic environment." More promotional products, more private label items, and more large-size packages are being sold.

Although Kroger had already lowered the prices of more than 2,000 products this year, coupon use has skyrocketed, according to The Street. "Customers are looking for more value, eating more at home, and cutting back on spending for products like snacks, alcoholic beverages, or pet items," Sargent noted. The company is responding with simpler promotions and lower prices.

As part of this strategic shift, Kroger has decided to close 60 stores that aren't performing as desired. The measure seeks to improve operational efficiency and refocus resources on the most profitable areas. "We don't make these decisions lightly," the CEO explained, assuring that other positions will be offered to affected employees.

The company insists that they will focus on their core business and on providing a better shopping experience. "We want to act quickly, focus on our core business, and offer quality stores. That's how we'll prepare Kroger for solid long-term performance," Sargent concluded.